Where Should You Prioritize Your Savings?

I will be off next week as I travel to San Diego for a beautiful wedding 😊

Back soon with a recap of Q3 2023…

Become Intentional With Your Savings:

As you begin to accumulate money, you may be asking yourself, “where exactly should I put all of this?”

Your options are endless:

• Keep it in cash

• Fund retirement accounts

• Invest in the stock market

• Spend money on items you need (even though you probably don’t need them…)

But it’s not all or none, you should be factoring in all stages of your life.

That’s why we have found it helpful to summarize your savings journey into three buckets 👇

Dealing with Volatility:

We have seen the markets give up some of their YTD gains in August and thus far in September. No reason to panic, volatility is to be expected, especially when you get such a strong start to the year.

But if you are feeling worried, here are some charts to engrain in your mind:

All the red dots signal the intra-year pullbacks the S&P 500 endured, and the gray bars show where the index finished the year. Main takeaway? Despite an average intra-year decline of 14%, the S&P 500 has finished the year in the green 74% of the time over the past 43 years…

“People overestimate the risk of holding stocks, and underestimate the risk of not holding them.” - Nick Murray

Yes, stocks are riskier than bonds and cash. But we need to take some risk in our lives to get where we want to go.

If you like the safety of cold hard cash, and are excited about the rates on high-yield savings, Treasury Bills, CDs, etc., that’s ok!

Frankly, you should have a substantial amount in cash for opportunities and to not force yourself to sell every time the markets decline.

But if you have money that you can let grow over the next 10-, 20-, 30-years, stocks have proven to be your best bet:

Let’s account for inflation as well:

Benjamin Graham once said, “The investor’s chief problem – and even his worst enemy – is likely to be himself.”

Retail investors have a tendency to chase the hottest stock, sector, trend, etc. This may seem rational, but it’s a very dangerous game to play.

This chart highlights that the top performing asset classes are always changing year by year:

Own the market and tune out the noise…

Did you find these helpful? Leave a comment about which chart resonated with you or how you plan to implement this information in your investment strategy 👇

Disclosure: This material is for general information only and is not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results.

All indices are unmanaged and may not be invested into directly.

All investing includes risks, including fluctuating prices and loss of principal.