Miscellanea - A Collection of ideas & Updates

Sometimes blog posts come easily and sometimes they do not.  Over the summer, I seem to struggle with things to write about plus market volatility tends to pick up, which keeps me busier managing money. 

Remember this when you are taking your vacation.  Think of me as I am lugging my laptop wherever I go because Mr. (or Mrs.) Market never seems to take any time off.  It's a good thing I love this stuff!

First up in this special blog addition is a couple market updates.  Let's start with equities and then move to fixed income (i.e., bonds).

Here is the situation with equities:

We have a rising trend.  A recent stairstep down and elevator up correction may not be the end of the volatility though.  Expect some volatility in the period leading up to the election maybe as early as September.

Once the election is decided and the loser taken their shot at the fairness of the election, we should see favorable seasonality into the end of the year and possibly into early 2025.

The trend is your friend until she isn't.  So far so good!

​​My guess is that 2025 is no picnic for whoever wins in November.  

We have weakening economic conditions and rising unemployment levels as big and small companies continue to shed jobs.  On the flip side, we still have strong liquidity from past government programs, a Federal Reserve that looks ready to start easing interest rates and a recent history of magically being able to kick the can down the road.

My guess is a mild bear market in 2025 with equities struggling and bonds doing better, especially on the short to intermediate side of the equation.  In fact, in years where interest rates decline, this has been the time to own bonds historically as falling yields move inversely to rising bond prices.

You may be saying, but Jeff, you said that about 2024.  That is true, but this is not easy, and my crystal ball is about as good as yours.  We generally try to work with what the market gives us.  We have an opinion on the future (like above), but only move as the market confirms such opinions.  You know, it is a process!

​This is the Federal Reserve Dot Plot or where they think the Fed Funds interest rate is heading.  In case you cannot tell, follow the orange line and/or the blue dots.  
​

If rates do indeed head down, here is the potential returns for varying changes in rates and durations.

​​Next Up, Let's move onto some good news for those affected by Hurricane Debbie.  Your kind, much gentler IRS has granted you a series of filing and payment extensions.

Of course, at the same time they are hiring more auditors to make your lives, I mean the lives of the rich, more miserable.

Here is the skinny: 

Click to read more.  Please consult your tax advisor for specific advice.

Finally, a few financial lessons that I learned over time, but wish I would have put into practice a bit earlier.  You know a few thoughts from my younger me.

1. Start Saving Early: Begin saving and investing as soon as possible. Even small contributions can grow significantly over time due to compound interest. The earlier you start, the better.
2. Create a Budget: Establish a budget to track your income and expenses. Knowing where your money goes helps you make informed decisions and avoid overspending.
3. Avoid Debt: Debt can be a financial burden. Whenever possible, use cash, debit cards, or prepaid cards instead of credit cards. Prioritize paying off high-interest debts promptly.
4. Invest in Financial Education: Learn about personal finance, investments, and money management. Knowledge is power, and understanding financial concepts will empower you to make informed choices.
5. Pay Yourself First: Before paying bills or spending on discretionary items, allocate a portion of your income to savings or investments. Treat your future self as a priority.
6. Live Within Your Means: Avoid lifestyle inflation. As your income grows, resist the urge to increase your spending proportionally. Save the extra income instead.
7. Emergency Fund: Build an emergency fund equivalent to at least three to six months’ worth of living expenses. It provides a safety net during unexpected situations.
8. Invest Wisely: Diversify your investments across different asset classes (stocks, bonds, real estate, etc.). Consider low-cost index funds and long-term strategies.
9. Prioritize Retirement Savings: Contribute to retirement accounts like a 401(k) or IRA. Take advantage of employer matching contributions—it’s essentially free money.
10. Focus on Experiences: While material possessions are nice, prioritize experiences over things. Travel, learn, and create memories—these enrich your life more than possessions ever will.

​Remember, financial planning is a lifelong journey. Start early, stay informed, and adapt as needed. 

I know I am preaching to the choir with most of you, but maybe someone you know could benefit from these ten financial lessons that I preach every day to my girls and Godchildren.

Can we help you with your investments or planning? 

Or why not get a Free Second Opinion on your planning? 

​Just contact us.