Category: Estate

Greatest Chart Ever 2024

It’s time for “The Greatest Chart Ever”, updated for 2024.

Please make sure the chart above shows on your screen! If not, please ask me to email you a copy.

Long-time TGIF 2 Minutes readers know this particular chart truly is a great chart* with data illustrating reasons to invest in stocks – and stay invested – for the short-, intermediate- and especially long-term. The information focuses on US stocks, namely the S&P 500, and lends to globally diversified stock investing, as well.

“The Greatest Chart Ever” offers needed perspective in times of volatility and uncertainty. Over a period of more than 40 years of intra-year stock market performance, the chart illustrates valid reasons NOT to allow short-term market moves (monthly, quarterly – or even yearly) to lead to poor investment decisions. Why? Please read on.

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Key Upcoming Changes to 401k & IRA Rules

There are a bunch – almost too many to count – of important details that a valued financial adviser can obsess over, so clients do not have to. One of those details is the 2022 SECURE Act 2.0 which continues to unfold, in two short months starting on January 1, 2025.

A number of the changes affect rules around two items:

  • 401k saving
  • RMDs (required minimum distributions) from Inherited IRAs.

Changes to both will also have present and future tax consequences.

 

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Decluttering Financially & In Real Life

Decluttering can be a sensitive subject. But mostly, decluttering is a positive game changer – financially and in real life.

The reason decluttering in “real life” can be sensitive may be obvious to married couples who, together, have gone through their garage lately (grown men can cry over getting rid of old ski gear from the 1990s – story from a friend).

Barriers to decluttering include:

  • emotional attachment to “stuff”
  • memories of times long ago when the stuff was useful
  • the hassle of carting all the old stuff off to a reclamation center (AKA the dump) which is time-consuming.

These factors prevent decluttering from happening.

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Timely Tax & 401k Info

At this time of year, it makes a ton of sense to focus on how best to maximize 401k accounts and which year-end tax considerations can be meaningful for tax year 2024. There is still plenty of time remaining in 2024 to make a difference.

Remember that Roth *401k* plans have slightly different income requirements than Roth IRA accounts:

  • Roth 401k accounts have NO income limits.
  • Roth IRA accounts DO have income limits.

Advice for higher earners who no longer qualify for Roth IRA accounts: make sure to utilize the Roth 401k to some extent, if your company offers a 401k plan with the Roth option. Also remember that Roth 401k contributions are made after-tax, whereas regular or traditional 401k contributions are made pre-tax.

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Beyond the Magnificent Seven

It’s summer and it’s HOT. Today’s will be a short and sweet edition of TGIF 2 Minutes.

The title for today was almost simply, “Beyond the Magnificent”. But a quick note on the “Magnificent Seven“ is in order.

The seven companies are, of course, Amazon, Apple, Meta (Facebook), Microsoft, Nvidia, and Tesla. This week – and the past several weeks – have seen volatility and shifts of short-term leadership in the stock markets from the Magnificent Seven growth companies to smaller and more value-oriented ones.

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Interest Rates, The Fed & Market Highs

Today’s edition of TGIF 2 Minutes is worth a comparison to this past February’s archives – just 6 months ago – and was originally titled, “Interest Rates, The Fed & Gray Hair.” In today’s re-run, readers will learn that the US Federal Reserve lowering interest rates is not the only mechanism able to cause the stock market to go up. Sometimes markets go up due to other factors including momentum or continued consumer spending, as in the past 6 months.

Question asked in February 2024:

How soon might the US Fed lower rates and how fast might the markets keep going up or falter down?

A certain amount of gray hair (read: wisdom and experience) helps in understanding the current interest rate and US Federal Reserve environment. Why? Because economies do not move as fast as same-day or even same-month. And “gray hairs” know this.

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Elections, Debates & Markets

As this edition of TGIF 2 Minutes was written prior to the first US Presidential debate, one piece of the “proof” will already be in the pudding for readers post-debate on Friday morning. Though not much should matter to markets related to the debate.

For the sake of thought and discussion elections can matter to stock and bond markets in the short- to intermediate-term. Debates – and State of the Union speeches – may (and may not) matter in the short-term as well. Big-picture policies like taxes, healthcare (drug prices and insurance coverage), social security, Medicare policy, government spending and more… these are all mentioned in presidential debates and speeches.

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Mid-Year & Critical Decisions

Mid-Year is an important time to review several significant saving and spending decisions, possibly affecting taxes too. There are slightly over 6 months remaining in the tax year – enough time to make a meaningful difference. Consider:

  • Amounts being deferred from compensation pre- or post-tax into 401k and other retirement accounts (and whether to max out?)
  • Savings goals versus reality
  • Savings goals in need of formation from scratch
  • College savings account contributions
  • Creating and funding Trusts

These and other important decisions can be evaluated and adjusted with just over half a year remaining to accomplish goals or mini-goals.

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Getting Paid to Take Risk

In true TGIF 2 Minutes fashion, a short note today – with further thoughts to follow.

A week ago, I had the distinct honor to set foot onto “Omaha Beach” in Normandy, France to recognize the 80th anniversary of the Allied Troops storming that beach on June 6, 1944, in the name of (future) freedom – and potential success – for multiple generations of free people around the world. The experience and the trip surrounding the experience left an impression that will not soon wear off.

Les Braves Omaha Beach Memorial on the Beach in Saint-Laurent-sur-Mer, France.

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10th Anniversary Edition!!

Hooray! TGIF 2 Minutes has entered its 11th year! It has been an absolute joy to hear from readers over the past 10 years and be part of your Friday morning cup of coffee or weekend reading time. For kicks, below is an excerpt from the very first edition in May 2014:

Good morning and TGIF,

In my efforts to give you Short & Sweet messages that make a POSITIVE difference in your LIFE, I am starting a “TGIF 2 minutes”. It will not be every Friday but when there’s something to say, it will be on Friday when you may have an extra 2 minutes in your day- or weekend- to read it. It will be worth reading! Please let me know your thoughts.

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