FINANCIALLY FOCUSED

October 2023 Newsletter

Happy Fall!!

It was wonderful seeing so many of you at our Client Appreciation on September 14, 2023. I hope you enjoyed the night as much as we did. We appreciate all of your business.

We are now officially in the month of October, the best time of the year if you ask me! The trees changing colors and we are getting our fall crisp days. I enjoy Fall with the many activities it brings, carving pumpkins, Halloween, football and apple picking. Lets not forget pumpkin spice makes everything nice!

October starts the final quarter of the year which means the amount of time left for working in 2023 is winding down. I find this to be a great time of reflection on the events of the year so far. During this time, you can assess your current financial situation and review the past year. Are you reaching your financial goals? Please do not hesitate to reach out if you have financial questions, we are here to help and answer all your questions. We will have Halloween Candy at the front desk please stop in and say Hello!

Important Update:
The Federal Funds Rate is the highest it has been in over a decade. We represent annuity and insurance companies that allow investors to capitalize on higher interest rates. We also have access to competitive CD money market rates.
Please call our office for further details and see if this makes sense for your portfolio.

Economic Outlook and Market Update
On September 20th, the central bank announced they will not increase the federal funds rate, maintaining a target range of 5.25% to 5.5%(1). The market reaction was a continued rise in interest rates, with the 10-year treasury rising to a level not seen since 2007(2). Generally, short-term interest rates rise above long-term interest rates when economic uncertainty reaches a high level. It is our expectation that interest rates will remain higher for longer as the Fed maintains a target inflation rate of 2% before the job is done.

GDP numbers have maintained a slow increase(3), inflation has fallen to 3.7%(4), and the economy has avoided a recession thus far. The consumer has held the economy together up to now, but we expect savings accounts to wane as high interest rates continue to have an impact on spending and economic growth. Three quarters of the way through 2023, a handful of mega cap tech stocks have been responsible for the equity market rebound. Given the expectation of higher for longer for interest rates, we believe it is prudent to look for opportunities outside of the mega cap tech sector. The dispersion in performance and valuation across the equity market from top to bottom has widened. Diversification is key to mitigating risk from a reversal in this trend.

Fixed income performance continues to struggle as the higher for longer theme plays out. Rising interest rates suppress bond prices. Investors that normally would invest in a diversified fixed income portfolio have remained in individual bonds or money market and other cash like securities. A combination of stable interest rates and investor willingness to flow back into bonds will drive future performance higher.

1https://www.federalreserve.gov/newsevents/pressreleases/monetary20230920a.htm 2https://fred.stlouisfed.org/series/DGS10
3https://fred.stlouisfed.org/series/GDP#0
4https://fred.stlouisfed.org/series/CPIAUCSL#0

Signs That You're Ready to Retire

Deciding when the time is right to retire can be difficult, but thankfully there are some common benchmarks and indicators that can help you determine that yes, you’re finally ready for your post-work life.

An Investopedia article, 6 Signs That You’re Really Ready to Retire presents some helpful details.

Read More

Pumpkin Bars

Classic pumpkin bars are super soft and moist and when spread with a thick layer of tangy cream cheese frosting, they’re positively irresistible. Pumpkin Bars are a classic fall recipe that everyone needs on their fall baking list.

Get Baking!

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Investment advisory services offered through Alternative Investment Advisors, LLC. (AIA), an SEC Registered Investment Advisor. AIA and its advisors do not render tax, legal or accounting advice. Fixed insurance products and services are offered through Swenson Wealth Management. Swenson Wealth Management is not a registered investment advisor and is not a subsidiary or affiliate of Alternative Investment Advisors, LLC. Swenson Wealth Management and their individually licensed and appointed insurance agents, and AIA are not affiliated with or endorsed by the Social Security Administration or any government agency.

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