Apprise’s Five Favorite Reads for the Week of September 5, 2021

Articles discussing: Starting to save early; Being busy vs. being productive; Emergency savings; Things rich people do; Your estate plan's softer side.
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Over the past few weeks, I’ve shared some personal thoughts as my wife, Diana, and I helped two of our children move into their college residences. This week, the risk of the Delta variant and emerging Covid cases hit home. Everyone in our house has been vaccinated. The University of Maryland requires all students to be vaccinated as well.
 
After being at school for only 10 days, one of our sons tested positive for COVID. The school asked that he quarantine at home. As a result, he’s living in our basement. Don’t worry. The bedroom he’s sleeping in has its own bathroom as well as windows. We are taking every precaution to try and make sure that we don’t come down with the COVID as well. Fortunately, as is typical with those who have been vaccinated, the vaccine doesn’t seem to have hit him too hard. We’re doing what we can to help him get through it relatively unscathed. Hopefully, he can return to school once his 10-day quarantine is over. We want him to have as normal a school year as possible.
 
His positive test also meant he couldn’t join our table as we celebrated the Jewish New Year. I would like to wish a belated Shana Tova to everyone who celebrates Rosh Hashanah.
 

Investment Commentary

 
The S&P 500 Index closed lower for a fourth consecutive day on Thursday at 4493.28. On September 2nd, the S&P closed at a new record high for the 55th time this year. It continues to be another great year for investors. As we finish the first full week of September, the S&P is up 2.2% for the month and 4.6% so far this quarter. It’s also 19.6% higher year-to-date. The S&P has risen 100.8% from the pandemic low it set on March 23, 2020. 
 
The market continues to rally despite changing perceptions about the U.S. economy. Earlier this summer, many economists believed the economy’s recovery would accelerate as Labor Day week arrived. They thought widespread vaccination rates would help ease labor shortages. Schools and offices would also reopen. Local businesses reliant on office workers would benefit. Travel would also rebound.
 
Instead, as we’ve experienced with our son, the rise of the Delta variant makes COVID remain top of mind. Businesses and consumers are now adjusting to renewed mask mandates. Events are being canceled. We have renewed travel restrictions. August payroll data showed a slowdown in payroll growth. Forecasts of economic growth are being downgraded as well.
 
Economists do not expect the variant to lead the U.S. back into recession. But it can slow growth. At the same time, Thursday’s new jobless claims of 310,000 set a new pandemic-era low. This news could help ease concerns about the economy.
 
What does this mean for investors? In short, uncertainty remains. Not all the available information points to the same conclusion.
 
As I’ve discussed in the past, forecasting the market’s future performance is a fool’s errand. Nobody can do so successfully with any degree of reliability or consistency. It’s also important to remember that the market and the economy do not always move in synch.
 
Those who regularly read my market thoughts should not be surprised to know there have been no material changes to my thought process. I maintain my view that we should continue to maintain a long-term focus and a positive long-term outlook. In short, I expect the market to move higher over time. At the same time, future bear markets and corrections are inevitable. Market timing is rarely a successful strategy. I am not aware of anyone who can consistently forecast the market’s direction. Against this backdrop, it’s important to stick to your process and not let the emotions of fear and greed drive your decision-making.
 
Here are the links to this week’s articles as well as a brief description of each:
 

1. Go Big, Then Stop.

When it comes to saving for retirement, I can’t emphasize enough how much you can benefit from starting early. I discussed this concept in one of my earliest blogs. It includes two graphs. One shows the benefit of starting to save for retirement at age 25 and stopping at age 45. The other shows what happens if you wait until age 45 to start saving and stop saving at age 65. The reason comes down to the value of compounding. The more years you give your money to grow, the more it can grow. If you have children or grandchildren who are part of the workforce, please share this article – or at least this message – with them. If they listen to it, they will thank you for it someday.

 

2. The Differences Between Busy and Productive People.

Are you a productive unicorn or a busy donkey? This article explains the differences – and I agree that it’s much better to be the former than the latter. Busy donkeys strive to fit more things into their days. Productive unicorns pause and cut their to-do list by 50%. In other words, focusing on productivity means taking a less-is-more approach. They also learn the difference between “urgent” and “important.” If you want to achieve peak productivity, you will stop focusing on looking and feeling busy. Instead, you will recognize the value of taking time for a break and recharging. This can help you achieve greater efficiency.

 

3. These Five Lifestyle Changes Can Make It Easier to Bulk up on Emergency Savings.

Many people do not have an emergency fund to cushion the impact of an unexpected financial blow. Ideally, you should hold at least three-to-six months of living expenses in your emergency fund. Some choose to put a year’s worth of expenses away. Many struggle to fund their emergency account. This article shares five tips to help you set additional funds aside. You may only have to change how you manage the resources you already have to do so. The fourth suggestion is one of my favorites: “Sell what you aren’t using.” My wife, Diana, has done this on several occasions as she purges items from our closets and other storage areas. It almost never hurts to “Reassess your credit card habits” as well. For example, our dryer broke down this week. We can fund the purchase of a replacement with unused credit card perks.

 

4. 19 Things Rich People Rarely Do

Not everyone aspires to be rich, but it can help to follow the habits of those who are. This list includes some great suggestions that can put more money in your wallet. Many of them can also improve your health and/or your quality of life. When I reviewed this list, I found that I practice many of these habits. Some of my favorites include:

  • Never hate their job.
  • Never neglect reading.
  • Never sleep in.
  • Never resist setting goals.
  • Never skip the gym.

Many of these have become bigger parts of my life since I started Apprise. In fact, doing so was the best career decision I made.

 

5. Don’t Neglect the Softer Side of Your Estate Plan.

When most of us think of estate planning, we focus on the distribution of our assets after we’re gone. If you have a large estate, you should also be concerned about trusts. You don’t want to overlook your views on life-sustaining care either. All these things matter. But we shouldn’t neglect the soft stuff. For example, consider the following:

  • Attitudes toward guardianship – if you have minor children.
  • Attitudes toward life during dementia.
  • Attitudes toward end-of-life care. This can go beyond what could be provided by your will or advanced directives.
  • Attitudes toward funerals, burials, etc.
  • Attitudes toward the care of your pets. Please don’t forget about your furry friends.
  • Attitudes about the disposition of personal possessions.
 
Our practice continues to benefit from referrals from our clients and friends. Thank you for your trust and confidence.
 
We hope you find the above posts valuable. If you would like to talk to us about financial topics including your investments, creating a financial plan, saving for college, or saving for retirement, please complete our contact form. We will be in touch. You can also schedule a call or a virtual meeting via Zoom.
 
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