June 2024 Blog Newsletter
June Captain’s Log
Wealth Management in an Election Year
One of my favorite holidays of the year, second only to Christmas, is July 4th! It’s a time to remember all those who came before us and the sacrifices that have been made. It’s a time to appreciate that we are free and live in the greatest country in the world, the USA, filled with opportunities and prosperity.
I enjoy setting up my own fireworks display, having a barbecue, inviting family and friends to enjoy our pool, and just being with those I love. The great memories made over the years are priceless.
Since we are in an election year and with July 4th approaching, I want to talk about Wealth Management. Here are a few points to consider: The average return for the S&P 500 index during a US election year is 11.57%.
In 19 of the 23 election years, or 83%, there was a positive return. Furthermore, the average return for the S&P 500 index after the election is 10.67%. These averages are based on the S&P 500 results from 1928-2021.
Individual client results often come back to client behavior and staying the course. The market tends to increase regardless of which party holds the White House.
Those who are more optimistic and willing to invest in the market have outperformed those who are more pessimistic and less willing to invest.
A few main takeaways would be:
There is no real correlation between the political party in the White House and stock returns.
The stock market was consistently and predictably positive from 1926 through 2022, with the only exceptions being the Great Depression, the tech bubble burst, and the Great Financial Crisis.
Your behavior, not the result of the election, is more likely to impact the performance of your investment portfolio.
Stay the course and continue to add to your investments during an election year!
Wishing everyone a happy and safe 4th of July!
The SECURE 2.0 Act: Everything You Need to Know and How It Impacts You
Did you know more than 4 out of 10 Americans aren’t saving for retirement and more than half of Americans feel like they aren’t meeting their retirement goals? The world of retirement planning is ever evolving, and staying informed about legislative changes is crucial to securing your financial future. The SECURE 2.0 Act is a significant update in this arena, building upon the original SECURE Act to further enhance retirement security for Americans.
The SECURE 2.0 Act aims to improve retirement readiness and security by introducing several key changes to retirement plans. However, it’s important to note that not every business will be able to implement these changes immediately. Some companies may lack the capabilities to meet the new requirements, while others are still figuring out what works best for them. As companies look to make those changes, here is what you can expect to change about your retirement options as an employee.
Major Highlights of the SECURE 2.0 Act
Roth options are now available for SIMPLE IRAs and SEP IRAs.
The required minimum distribution (RMD) age is now 73.
You no longer have to take RMDs from Roth 401(k)s and Roth 403(b)s.
You face smaller penalties for missed RMDs.
You can roll over unused 529 plan funds to a Roth IRA.
Employers can match your student loan payments with retirement contributions.
What to Expect by Year
Understanding these changes year by year can help you better plan for your financial future. Here’s a brief overview of what to expect each year as the Act’s provisions come into effect.
Looking back…In 2023:
The RMD age increased from 72 to 73, giving retirees more time to let their savings grow tax deferred.
Penalties for failing to take RMDs were reduced, easing the financial burden for retirees who missed their distribution deadline.
SEP IRAs and SIMPLE IRAs were added to the list of employment plans, broadening the scope of available retirement savings options.
In 2024:
529 Plan Rollovers: 529 Savings Plans, which need to be set up for at least 15 years, can be rolled over to a Roth IRA if there is a remaining balance. This change helps avoid cash penalties on the growth and withdrawal of unused funds.
In 2025:
Companies are expected to automatically enroll employees in 401(k) plans, ensuring more workers are saving for retirement.
How Anchor Wealth Management Can Help
Navigating the intricacies of the SECURE 2.0 Act can be challenging, especially as businesses and individuals adjust to the new regulations. Professional guidance ensures that you stay informed about new developments and make strategic decisions to enhance your retirement security.
Stay proactive, stay informed, and let Anchor help you navigate the path to a secure retirement.
By Adam Ludwig, CEO/Wealth Advisor
Learn More about Adam and the AWM Team
Adam’s Nightstand
I am currently reading “High Road Leadership: Bringing People Together in a World That Divides” by John Maxwell.
Hard to believe John Maxwell is 77 years old and still writing great books! I am sure many of you have read a John Maxwell book at some point in your life. Some consider him to be the world’s most influential leadership expert.
I really enjoy his books and like to delve deep into the content to apply my learnings to my life and those around me. John says that leadership can be a blessing or a curse. It can help people rise to a better life or cause them to fall into despair.
Learn the principles and practices of high-road leadership that can increase anyone’s influence and help them make their world a better place. The world can benefit from everyone reading and applying what they learn in this book to their lives. We all can be leaders at our place of work, in volunteer settings, at home with the family, at church, and so on. Leadership is everywhere. I recommend everyone read this book.
Hollywood Glitz and Glamour
Cherry Johnson, AWM’s Client Relationship Concierge, attended the premiere of The Bike Riders on Monday, June 17th at the TCL Chinese Theatres on Hollywood Boulevard.
Cherry’s sister Phuong Kubacki plays Gail in the movie, alongside Austin Butler, Jodie Comer, Tom Hardy, Norman Reedus and many others.
While Phuong was busy doing interviews and posting for photos with cast, Cherry was busy meeting celebrities on the red carpet.
Cher, Kaia Gerber, Sharon Osbourne, Sharon Stone and Jason Mamoa were some of the A-list stars who attended the event and walked the red carpet.
Cherry is a huge of Vanderpump Rules and The Valley. She was excited to get photos with cast members Brittany, Janet, Michelle Lally, Jax Taylor and Jessie Taylor.
Cherry and Phuong also attended an after party where she got to spend some time talking with The Bike Riders cast members Norman Reedus and Toby Wallace.
It was a night of hobnobbing with the rich and famous that Cherry will never forget.
The Bike Riders opened nationwide on Friday, June 21st. If you get a chance to see the movie, you won’t miss Phuong and her huge beehive hairdo and yes that is her real hair.