As we prepare for the holiday season and the end of 2022, I’ll start by saying what many of us are thinking: what a year! After two years of “pandemic life,” we thought that this year was going to be good–both for the markets and the economy. There’s no way to deny that it was a much rougher year than we expected. Although the markets started off strong, the Russian invasion of Ukraine and ongoing war there, continued stifled production in China, rising inflation, and rising interest rates have all made for an economy that is not as strong as anyone would have liked. However, things are not all bad. Here are some reflections on this past year, and what we should be thinking about as we head into 2023. 

We’re ready for challenges because we think ahead. 

Yes, the market has been challenging. But if you’ve been in this business as long as I have, you know that the markets shift. We also know that a downturn in the market doesn’t mean that it is all bad for every investment. This is why we advocate for true diversification. While some stocks have been underperforming, like tech, other stocks have gained value, especially in the energy sector (1). We also have two asset allocations that are mitigating risks as advertised: tactical bonds and managed futures. 

Strategies are available to help your portfolio. 

We also know that we are looking at long-term strategies for growth. As I explained in our November newsletter, tax-loss harvesting allows us to balance market losses with market gains to reduce the overall tax paid on capital gains, and reinvest any gains to balance and diversify portfolios. For our 401(k) clients, we also recognize that we are looking at the long-term. While a down market is stressful–and especially so for people who are nearing retirement–the overall growth of the stock market over time still averages out to over 7% annually (2).

Prepare for the year ahead. 

Being prepared and informed always helps with financial planning. The first thing we recommend before the end of the year is to check on your retirement account contributions. In 2022, you can contribute up to $20,500 in a 401(k), but you must do so by December 31, 2022. You can contribute up to $6,000 in an IRA, and you have until tax day (April 18) to do so.

These numbers are also going up in 2023, so consider if you are able to contribute more. One way to know if you can contribute more is by making sure that your personal finances are in order. A personal finance audit may help you balance your income and expenses better, and allow you to put away more for retirement. We also think the New Year is a perfect time to review your plan beneficiaries and update your estate plan. If these last years show anything, it is that we live in unpredictable times. We should all be doing our best to prepare for what may happen. 

I appreciate your continued trust and as a fiduciary, I seek to help you make decisions on your investments that will help you reach your financial goals. If you have any questions about your retirement accounts or investments, don’t hesitate to reach out to us. 



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