retirement

New Year, New Rates? Market Brief February 28 2024

jim Financial advisor, Investing, Investment Management, Market Brief, retirement, Retirement Income Planning, Retirement Planning, wealth management , , , , , , ,

Given the choice between more time or more money, which would you pick? This question is not just a thought experiment but a reflection of the trade-offs we make daily in our pursuit of happiness and success. How you answer can significantly impact your saving, spending, and goal setting.

Research shows that our sense of happiness and fulfillment is directly linked to how we spend our time and money. When we prioritize time over money, we may find more joy and satisfaction in our lives but may have less financial security. On the other hand, prioritizing money may leave us feeling unfulfilled and stressed.

new year new rates

Since 2024 is a leap year, you’ll have an additional day. Why not spend some time on that day considering one practical action to optimize your resources?

Onward to rates… Interest rates affect us all. Whether you’re seeking the highest rate for your savings or the lowest for your mortgage or credit cards, knowing how to manage this aspect of your finances is increasingly important in an ever-changing environment.

Though most forecasters expect the Fed to cut a benchmark short-term interest rate soon, rumors of “higher for longer” rates persist. And although we can’t predict the future, we can prepare for it. Are you ready for when this change happens?

Understanding key financial concepts is important to maintaining not just your financial health but also your financial confidence and happiness. And interest rates are more than just numbers in the news; they’re the heartbeat of your financial wellness. More on the current interest rate environment in the Market Brief below.

Feel free to share if you know someone who could use guidance. As always, I’m available for any questions or ideas you have regarding financial strategy.

Market Brief – New Year New Rates

Another week is behind us in 2024, while stocks have seen more recovery highs and the major indices have seen more all-time highs. The week ending Feb 23 saw the S&P 500 rise 1.7%, the Nasdaq added 1.4%, and the Russell 2000 lost 0.9%. For the S&P 500 and Nasdaq indices, last week was the 15th of 17 on the upside. During the 17 weeks, the S&P has gained 23.6%, and Nasdaq is up over 26%. Those are great returns for a full year!

In other news, Amazon.com replaced Walgreens Boots Alliance in the 30-stock Dow. New home sales in January 2024 rose 1.5% from December to a seasonally adjusted annual rate of 661,000 units. The median sales price was $420,700 and the average sales price was $534,300.

As for a recession, it is likely that the U.S. economy will avoid one into 2025. The Federal Reserve will likely start to lower interest rates later this year, and earnings growth is poised to accelerate over the next few quarters. There are fundamental risks to be sure, such as geopolitical developments (Russia, Mideast, China), high interest rates (the Fed hasn’t cut yet), the chance of recession (always a possibility), not to mention the upcoming 2024 U.S. presidential election.

The Fed’s next rate decisions come at the end of March and May. For March, odds of a rate cut are only about 4%, according to the CME Fed Watch. For May, odds go up to 26%. That’s also much lower than was the case over in last few weeks. Year-to-date the S&P is up 6.8%, Nasdaq up 7.9%, and Dow up 2.9% through intraday today.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers. This is not a solicitation or offer of service in states we are not licensed in.

Financial Advisor Erie CO focus on investment and wealth management, retirement planning; Boulder, Louisville, Niwot, Lafayette, Windsor, Berthoud, CO

Markets reach All-time Highs

jim Financial advisor, Investing, Investment Management, Market Brief, retirement, Retirement Income Planning, Retirement Planning, wealth management , , , , , , ,

all-time highs

Happy New Year, happy January, and welcome back to All-time highs! As we embark on this fresh chapter, consider this, it has been two years since we last reached this threshold. A lot has happened since then. In some areas of life, value is unlocked by starting, while in others, it’s found in the finish. What’s your focus for 2024 and beyond? Whether you need to kickstart new financial habits or follow through on existing plans, I’m here to help you navigate the journey.

Financial success often hinges on effective beginnings and successful completions. Starting on the right foot positions us for a year of financial achievements. This year let’s work together to initiate valuable habits like automatic savings, strategic budgeting, and a tailored financial strategy aligned with your long-term goals. If there’s anything left unfinished from 2023 – unsure what changes to make, coverage to put in place, accounts to contribute to, when to save, etc. – let’s tackle it head-on for a more financially fulfilling year ahead. Even minor adjustments to your financial strategy today can make a big difference over time.

The second Friday of every January is infamously known as “Quitter’s Day.” It’s the day on the calendar by which most people have already abandoned their freshly made resolutions. Hopefully you powered through and are still on track with your 2024 goals. Truthfully, it’s not hard to believe. As we’ve all experienced at one time or another, it’s easy to get discouraged with our goals, especially after the initial enthusiasm starts to fade. The secret to staying power is breaking down your long-term goals into smaller, more manageable milestones. What can you do today that will improve your situation by December?

As always, if you have questions any day of the year, reach out to me. Together, we can create an action plan tailored specifically to you. As the saying goes, winners are not people who never fail, they are people who never quit. Here’s to unlocking value and achieving financial success in 2024!

Market Brief – All-time Highs

This is a huge earnings week, with many big-name companies reporting. The week also features important inflation data, and talk about the Fed’s next rate move will heat up ahead of the rate meeting next week. The FOMC decision on January 31 is widely expected to result in unchanged interest rates, while future rate-cut expectations have become less optimistic. Last week, the Dow Jones Industrial Average was higher by 1%, the S&P 500 up 1.2%, and the Nasdaq up 1.6%.

Mortgage rates dropped slightly last week, to 6.6% for the average 30-year fixed-rate mortgage. Gas prices fell a penny to $3.06 per gallon for the average price of regular gas. The Atlanta Fed GDP indicator is forecasting for 4Q and calls for expansion of 2.4%.

Stocks headed higher today with the S&P 500 on track to hit another all-time high. The stock market blasted off late last week, propelling the S&P 500 to an all-time high. It has been a long recovery (over two years) for the index, as its last All-time high was on January 3, 2022. The Nasdaq still has work to do to reach their all-time high from late 2021 and early 2022. Year-to-date, the DJIA is now up 1%, the S&P is up 1%, and the Nasdaq is up 1.6%.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers. This is not a solicitation or offer of service in states we are not licensed in.

Erie CO Financial Advisor; investments, wealth management, retirement income planning; Boulder, Broomfield, Louisville, Niwot, Windsor, Berthoud CO

#investing #marketbrief #stockmarket #retirement #wealthmanagement #financialadvisor #retirementplanning #investmentmanagement #retirementincomepla

Market Volatility: Keep Calm and Carry On

jim Financial advisor, Investing, retirement, Retirement Planning, wealth management, wealth planning strategies , , , , ,
keep calm

I don’t know about you, but this isn’t exactly how I thought we’d be approaching autumn. The Delta variant is causing some of us to pivot and alter plans once again. Amid reports of extreme weather as seasons change along with up and down markets, I’ve decided that I’m heading for much higher ground. Are you with me?

The fact is, storms of life come – often quickly and unexpectedly. And while we can’t stop the storms, we can do our best to prepare for and weather them until they pass. Destruction and loss will cause added stress, and that’s not the best environment in which to make decisions. The optimum time to prepare is now, before the next storm hits, focusing on what we can control and the best route upward. 

Markets naturally go up and down. Over the long run we all know they go up a lot more than they go down. But in these times of market volatility it can be stressful on all of us. The key to managing stress from fluctuations in the market is to ignore noise.

We create portfolio’s based on the clients long term goals. This way clients don’t need to worry about occasional market dips which newspapers and other media tend to sensationalize. Investing is about long term returns not short term ratings.

In fact stocks are actually on sale, so now could be a good time to go shopping. Although significant market dips can be attention-grabbing, they can also present a buying opportunity. If you have any questions about your strategy in light of recent events, let’s talk.

Please let me know if you want to discuss anything at all, from this weeks’ market news to specifics about the portfolio we have implemented.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

Preparing for retirement emotionally

jim family wealth management, Financial advisor, Investing, retirement, Retirement Planning, wealth management , , , ,
retirement emotionally

Retirement paves the way to a new and exciting chapter of our lives, emotionally too. This is the moment of relief when, for the first time ever, we now have ample time to travel the world, take up new hobbies, and scratch whatever itch we’ve been ignoring.

Yes, retirement should be exciting. But for many of us, the thought of leaving our jobs forever can be daunting. After all, our careers play an important role in shaping our identity. And to suddenly cut the cord means we have to find something else to fill the void.

This isn’t helped by the fact that the word ‘retirement’ can be quite limiting – when it’s anything but. All too often, people associate it with old age and the ‘pipe and slippers’ part of life. This is why the financial conversation is often limited to how much you might have to retire on. And that’s that.

But it’s not as simple as that anymore. Today’s typical 60 somethings are nothing like those of a generation ago.

A lot of this comes down to the fact that life expectancy in North America has been on the rise for some time now. A generation ago, men could expect to live up to their late sixties, and for women their mid-seventies. Since then, life expectancy has improved incrementally. The current life expectancy for North American men is 76 and women 85.

This means that for many retirees these days, retirement isn’t a wind-down phase, but a whole new beginning. This means that financially speaking, you might need to consider how to manage your retirement fund more strategically.

But how do you prepare for such a massive transition emotionally?

According to gerontologist Ken Dychtwald, it’s all about mindset. He advises people approaching retirement to do so as they would a career: His advice is to set goals, to visualize a ladder to climb, and to use these targets as motivation to move closer towards your next destination.

Unfortunately, the statistics show how detrimental it can be to find yourself without purpose and meaning at retirement: depression is prevalent in 22% of men and 28% of women at the age of 65 and over.

If you’re unsure of how to even begin to plan for retirement, then following some of the principles from Professor Dychtwald’s five phases of retirement could help you map out your journey.

Imagination (15 before retirement)

Being at least fifteen years away from finishing work for good, retirement might not seem like a priority. At this point, you’re more likely to be making sure that career aspirations are met, bills are paid, and your children are able to get through university.

But it’s important to think about your pension at this stage as it can help to ensure you have the financial stability to live life on our terms, post-retirement. This is where you can start to dream big and imagine the retirement you really want to have.

Anticipation (3 years from retirement)

Now you’re planning to turn retirement it into reality… this is where preparing emotionally is just as vital as preparing financially.

A great way to do this is by trying to develop a network of retirees whom you can trust for advice so they can share their experience of how they coped with the process.

Make a note of the goals you want to accomplish and what measures need to be put in place in order to achieve them.

Preparing (1 year before retirement)

The new beginning is near! Now’s the time to start developing concrete steps. Ask yourself what you’re going to do during the first week of retirement and what you plan on doing on a day-to-day basis.

Make a plan of what you want to achieve in the first six months and talk it through with your partner or loved ones. Visualizing the practicalities of this new phase will make it seem less daunting when it eventually arrives.

The liberation phase (first year of retirement)

Your working life is finally over! This is the stage when you’re likely to feel the most excited, relieved, and liberated. You can finally begin to explore new opportunities, travels, and hobbies.

Unfortunately, this honeymoon period will eventually fade, but remember, this is natural.

Dychtwald states the importance of staying physically active and maintaining strong social ties with people at this stage.

Reorientation (3 years into retirement)

This is the part where creating a legacy for the next generation can be top of mind. Whether that’s by sharing your knowledge and wisdom with others, or by thinking more carefully about the financial gifts you’re leaving children and grandchildren, this is an opportunity for you to decide what impact you want to leave on the world.

Hopefully, this is helpful in terms of thinking about retirement and a brand new beginning. Retirement isn’t the end of the road; dream big and don’t be afraid to chase after your deepest desires.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

How to Start Investing

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How to start investing

So, you’ve landed your first “real” job! Now’s the perfect time to create your first investment plan and start investing.

First, let me congratulate you on getting through school and starting your first “real” job. You’ve worked hard to get here, and I’m sure there are many things you’ll want to spend your new paycheck on. An apartment of your own, some decent takeout (not from a student cafeteria), maybe a little traveling.

You should do those things, as long as they fit into your budget. You’ve earned a little breathing room. But now that you have some stability, you should also thinking about how to start investing for your future. Here are three ways to get the ball rolling.

1. Pay down debt

As a student, you may have accumulated a mix of debt, from student loans to credit cards. Create a debt-repayment plan that focuses on paying off your high-interest debt, like credit cards, first.

Student loans often carry lower interest rates, so these loans might not be your top priority. At the same time, many student loans require you to make a minimum monthly payment shortly after you graduate, and you only have so much time to repay the entire loan. You still need a loan-repayment plan to make sure you don’t default on these loans.

2. Build your emergency fund

Post-graduate life isn’t all sunshine and rainbows. Sometimes your air conditioner breaks down in the middle of a heat wave or your car dies on the way to a meeting. I suggest putting 10% of your paycheck into an emergency fund to cover unexpected expenses. The goal is to eventually have enough money in your emergency fund to cover three to six months’ worth of expenses, but it can take a while to get there.

Your emergency fund should be low risk and easy to access, like a regular savings account.

3. Think about retirement

This is the best time to take advantage of the power of compounding. If you start putting just $200 a month into a retirement savings account at age 25, and let it grow over the next 40 years at a 4% rate of return, you’ll have about $237,000 in that account when you turn 65.

Wait another 10 years to start investing the same amount at the same rate of return, and you’ll reach age 65 with about $140,000. That’s a big difference.

If your employer offers a 401(k), use it. With this tax-advantaged retirement account, you contribute pre-tax dollars directly from your paycheck. You employer will also match your contributions up to a certain percentage of your salary.

If you don’t have a 401(k), look into a traditional IRA (individual retirement account) or Roth IRA. With a traditional IRA, you’ll get a tax break on your contributions, while with a Roth IRA, you won’t pay federal taxes when you withdraw money in retirement. With both types of IRAs, you won’t pay taxes on any investment income you earn within the plan until you start making withdrawals.

Ready to start investing? Contact me today and we’ll work on creating your first investment plan.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.