New financial education series and income planning for 2024

Happy New Year! One of our resolutions, if you will, for this year is to take a moment to stop and celebrate the wins in our lives. To be honest, this is not something we’ve been the best at in the past, but that changes today. 

Sound Financial Strategies Group is 30 years old this year! Even though we’ve all encountered challenging times, there have been many good years. And every year has been marked by good relationships — and we’re grateful for each of y’all for being a part of this journey with us. 
Now, let’s get down to business …

Introducing our 2024 financial education series

We’ll begin this month — as well as throughout the first quarter of this year — by focusing on income planning. More specifically, we’re going to talk to you all about your cash flow, your income, your expenses, and what we can do to help you maximize all of your opportunities. 

In the second month of each quarter (starting in February), we’ll dive into investment planning, with our special guest, Clint Sorenson, who will present our investment framework and how we look at the world. Candidly speaking, we don’t look at the world in the way many other investment advisors do. 

🔎 Related: Investment strategy, the Sound Financial way

In the third month of each quarter, that’s when we really start to dig into the fun stuff by taking a look at current events. Now, we’ve developed the cadence of this education series in this way so that we don’t spend each month talking about current events. Let’s be honest, the world is one big current event at all times, and we can’t spend every month talking about the election. 

To be clear, we are not dodging the topic of the election. We’ll be talking about the upcoming presidential election in September, as our dedicated topic. We won’t be doing so, however, through a Republican lens or a Democratic lens. Instead, we’ll talk about what’s happened throughout the years, during previous presidential election cycles — as well as the oddities we’ve experienced in recent years. 

Market update for January 2024

The Stock Market Almanac has a theory. Historically speaking, if January is positive in the U.S. stock market, the stock market returns a little bit over 9% that year. On the other hand, if January is negative, it returns a little bit over 2%. 

🔎 Related: Is the stock market gambling?

Is this a perfect methodology? Absolutely not. It was wrong in 2020. It was wrong in 2021. It was, however, accurate in 2022, as well as 2023. That’s why, although this is by no means something we use to inform our decision-making, it is something that’s fun to watch. To date, it’s been down and then up, but who knows where it will be by the time you read this.

Year-to-date, the S&P 500 is positive. We’ll have to see how that holds throughout this month, as well as the remainder of the year. 

Focus areas for income planning

Now, the majority of you who are joining us for this conversation are retired and would very much like to stay retired — and that’s exactly what we want for you, too. The stock market exists as just a tool for us to grow your money, to produce an income, and to establish a foundation for your income. 

🔎 Related: Investing after retirement (tips + examples)

Remember, money is just a tool. A tool you can and should use to live your life and fund your life. Money is never the end goal, itself. With that in mind, ask yourself the following questions:

What are your needs and goals in 2024? 

Think about what you want to accomplish. If life is good and you simply want to say the course, great! Stay the course! If something needs to change, that’s something we need to look at together, so we can make a clear plan of action.

For instance, do you need to buy a new car? Do you need to buy a new air conditioner or roof for your home? Do you want to buy that vacation home you’ve always been dreaming of or take a trip to Tahiti? Are there large gifts for others (or heck, maybe even yourself) you want to give this year? Are there charities or causes to which you want to donate?

(That last part on charitable giving is something we’ll cover in the fourth quarter.)

What are your current income and expenses? 

How much do you have coming in? How much do you have going out? Now, if you’re hearing this as me asking you to sit down and write a budget (something I know some of y’all don’t want to do!), all you need to do is put together something simple that shows what’s coming in and what’s going out. 

We do this because we need to make sure everything aligns with your investments and the foundation of those investments. For example, annuities are very rich right now. That’s not a recommendation I would make for everyone, but that coupled with dividend stocks was a great portfolio we talked to a lot of you about last year. 

🔎 Related: How the U.S. economy works (an accessible overview)

As we look more closely at your income and expenses, is there debt out there that should be paid off and, therefore, you could reduce your income because you’re reducing your expenses. Or perhaps it merely improves your cash flow by paying that off. 

Have you talked to your Sound Financial advisor?

If you haven’t yet, I encourage you to sit down and have this conversation. It’s the start of a brand new year, and this is a great moment for us to reflect together on what we achieved in 2023, what needs to change in 2024, and what you want to accomplish. More importantly, we can work together to make your goals achievable with a concrete, actionable financial plan. 

For some of you, that big, bold plan of action may be a plan of relaxing. Because I think we can all agree the past four years have been hard. It’s been a hard time to look at portfolios. It was hard last year to watch the stock market take off at the end of last year — meanwhile, you’re left wondering why the heck it did that. 

We’ll talk about the “why” more next month.