July Newsletter- A Bear Market, Oh My!

The S&P 500 fell into a bear market in June, more than 20% off its January all-time highs. Investing through prolonged downturns can be painful. My personal portfolio is down WAY more than 20%. Historically, the best results come from continuing to invest throughout the painful times using dollar cost averaging. Making regular contributions month after month makes investing a habit and keeps you investing even when it seems the world may be falling apart. Bear markets are often the BEST times to be investing for the long-term….it just doesn’t feel like it at the time.

Secure Act 2.0?

The SECURE Act passed into law in 2019 made adjustments to rules for IRAs, RMDs, and 401(k)s. See those explained here.

Many proposed changes have again been making their way through Congress and it’s being billed SECURE 2.0. Nothing is official yet, but some of the proposals suggest pushing required minimum distributions (RMDS) to even later ages, making 401(k) enrollment automatic, and opening up employer 401(k) matching to include student debt repayments. Read more here. Listen to the Check Your Balances podcast, “SECURE 2.0 – What’s coming?”, here.

A Slice of Optimistic Data

In times of war, high inflation, talks of recession, and rising interest rates, it can be hard to be optimistic. Yet, there is a quite substantial amount of data that actually suggests quite a bit of improvement in the United States and globally in a wide range of areas. Housing is still out-of-reach for lowest income workers, but surprisingly wages have actually outpaced homeownership costs in the past 30 years. Deflation is more common than we realize. The cost of TVs, internet, cars, apparel, appliances, and much more have actually gotten significantly cheaper over time. Medical costs are higher, but people are also living longer and are much less likely to die from cancer, heart disease, and childbirth. Check out the two articles from Morgan Housel and Timothy Lee