What I've Been Reading | September 2022
Written by Ryan Hitchcock (Financial Advisor, High Point Capital Group, Milwaukee, WI)
This month saw the financial talking heads working overtime trying to explain many of the recent headwinds facing investors, such as:
> WHY the stock & bond market have hit their lows of the year
> WHY inflation is out of control
> WHY interest rates are going up
>WHY our economy is heading into a recession (or is in a recession)...just to name a few.
And this isn't new, it's been on repeat all year. There is so much of this rhetoric out there right now, it's hard to know who's right, who's wrong, or who's just guessing. So in today's newsletter, I don't want to add to this confusion by sharing certain articles about the WHY. I want to bring the conversation back to the WHAT.
WHAT does this mean to you? You, the everyday person trying to invest for their future.
But, before we move on.
Here's a picture of some cute puppies to clear your head:
It's going to be OK (hope inside)
I sent this note out earlier this week, so if you haven't read it I encourage you to take a peak. My quick recap: A few things I'd like you to keep in mind right now:
> Big market moves happen frequently when the world is uncertain.
> Feeling anxious about a selloff is normal, but it shouldn't drive your decisions.
> We're in challenging times, but we're going to get through them. We've been here before. Not this precise moment in time, of course, but...
We've planned for situations like these, where we see harsh conditions and volatility, but we don't know exactly how they will play out.
The strategy we've built together is designed to withstand these kinds of storms.
Market Losses: Can you still meet your financial goals?
My quick recap:
History is on the side of disciplined investors.
>Severe market drawdowns, while unpredictable, have occurred with some regularity throughout financial history.
>Following these events, the market has turned positive about 83% of the time over the next 3, 6, and 12 months.
>Returns have tended to increase with the time horizon, averaging a 14% gain one year out from the event.
Value of the U.S. Dollar Over Time
My quick recap:
I know I mentioned I wanted to bring the conversation back to the WHAT...but these PDF's are just great reminders of WHY one invests over the long term.
> Purchasing Power of the U.S. Dollar since 1980 - Dollar Purchasing Power Since 1980.pdf
> Purchasing Power of the U.S. Dollar since 1913 - Dollar Purchasing Power Since 1913.pdf
Hint: The value of the U.S. Dollar has gone down.
Helpful Resources - Found on rhitch.com
- Stock Market's In Perspective - YouTube 5 min watch time
- Budget Worksheet: Now vs. Retirement - PDF
- What is a Fiduciary and Why You Should Care - PDF
If you have any questions about how to plan for inflation in your personal situation, please don't hesitate to reach out!