Weekly Market Recap – 01/03

60 Second Market Review

What happened?

  • 2021 ended with one of the best stock performances in years, ending close to record highs. Should you still get in now? Or is it too late?

Things to be aware of…

  • January is for getting organized – and we’re going to hammer financial organization this month.
  • Want to double your wealth? Forbes says those with a plan have double the wealth than those without one. Meet with us today.

The Details

What happened? 

2021 ended with one of the best stock performances in years, ending close to record highs. Should you still get in now? Or is it too late?

Source: Ycharts

 

Actionable Items for You:

  • 2021 was a banner year for stocks. The S&P 500 gained 26.9%, one of it’s best years in a while. 
  • Should you invest now? Short answer: yes, especially long-term.

Now that the markets have closed off 2021, how did we end up? Pretty, pretty good. The S&P 500 gained 26.9%, the Nasdaq gained 21.4%, and the Dow Jones finished 18.7% higher. That means if you were invested, you probably had a pretty good return.

And that leaves us with a couple of questions. If you didn’t invest, is it too late? And if you did, is it time to get out? 

Let’s start with the first question. It is never too late. Just because the stock market does really good one year, doesn’t mean it won’t continue to do well. While we shouldn’t be setting expectations as high as 27% every year, the stock market has compounded annually around 8-10% on average, depending on your start date, for the last 100 years. So maybe temper your expectations, but you can comfortably invest even close to the peak in the stock market, as long as you have the time horizon of 10 to 20 years from now. 

It’s simple: the stock market (aka the S&P 500) is one of the best ways to compound your wealth over time. 

Source: Ycharts

The second question, if you hit a good year, is it time to get out?

Short answer: no. Long answer? It will depend on your risk tolerance. This will sound contradictory to above, but it’s actually all part of the portfolio construction process. When you decide what to invest in, you should be getting a properly diversified portfolio based on how comfortable you are with volatility and losses, and also your ability to take volatility and loss. So if you have a long time horizon, stable and high earnings, and can handle the risk, you probably don’t need to make a lot of changes.

But, if you are a balanced investor that can’t or won’t take on the full risk of the stock markets, you might want to rebalance your portfolio. The reason is your risky assets probably outgrew your less-risky assets, and it might have put your balance out of whack. And that might mean selling some stocks. 

Remember – that’s only if your portfolio is no longer properly aligned to your goals and objectives, and your willingness and ability to take on risk. There’s an old saying in the stock market: “Pigs get fat, and hogs get slaughtered”. Lesson: Take opportunities to rebalance when times are good, even if you miss out on some upside in the long run. 

We want to help you and build our community, and if you’re going to get started, feel free to set up a time to chat.

Things to be aware of…

January is for getting organized – and we’re going to hammer financial organization this month.

Actionable Items for You:

  • The first step to your 2022 goal of getting your finances? We have you covered – get all of your documents together. 
  • We’re going to tackle getting organized this month from a financial perspective. Some topics for the rest of the month are below. 

2022 is here! Welcome to the future. 

Is one of your goals to get your finances in order? If it’s something you’ve had on the back burner for some time and you want to take the plunge, we’re here to help. It can seem overwhelming to get started – but it doesn’t have to be!

Start by allocating some time each week to getting organized. This can be an hour each Wednesday night, or even a couple of hours before game time on Sunday. Make sure you commit to some time each week and don’t try to tackle it all at once – that’s how you lose momentum. 

Next, you can gather all your statements and log into all of your accounts (bear with us – this might be the hardest part in getting organized). You want to gather info for all of your accounts that have any monetary value or info related to your finances, including life insurance, wills, and trusts. Here’s a checklist:

Look for your Assets:

  • Bank accounts, investments, retirement accounts, and real estate

Find out your Liabilities:

  • Credit cards, student loans, mortgages, and any other debts

Write down your Income:

  • Salary, gifts, investment income, business income, etc.

Track your Expenses:

  • Credit card and debit card statements, bank statements, or any other source of spending

If you want a comprehensive list of important financial documents, reach out to us at Freeman Capital today – we can send a list over to you. 

In addition, our secure platform allows you to link all of your financial accounts and hold your financial documents in a secure vault if you want to work with us.

As a start, here’s a PDF link to Right Capital – One Stop Access

And watch this video to help stay on top of your financial life. 

And voila – all of your documents have now been gathered. For the rest of the month, we’re going to cover:

Determine your Financial Goals
Tracking your spending 
Consolidate and Automate 

Do you want some help with getting financially organized? We’re here to help. Meet with us today.

Want to help us? Share this with your friends and family. 

Weekly Market Recap – 12/27

60 Second Market Review

What happened?

  • Happy New Year from us at Freeman Capital
  • If you have a student loan, some good news! (for once…)

Things to be aware of…

  • Self-employed & saving for retirement?
  • Want to double your wealth? Forbes says those with a plan have double the wealth than those without one. Meet with us today.

The Details

What happened? 

Happy New Year from us at Freeman Capital. 

 

Actionable Items for You:

  • 2021 was full of surprises. Let’s reflect, be grateful, and be full of hope for 2022.
  • The holidays are a great time to reflect and give back or to spend some time concentrating on yourself.

Where to begin. 2021 was a year full of challenges, rewards, optimism, and pessimism. All we know for sure is that we will be entering 2022 a year wiser a week from now.

For the markets, things went extremely well overall. If you stayed consistent, you probably saw some strong gains this year, despite plenty of uncertainty and volatility. And that is a lesson in itself.

But overall, we want to focus on a couple of things at Freeman Capital: being grateful and hopeful. Grateful for what we have and what we have lost, hopeful for the years to come, and for the growth we experienced. If these past few years have taught us anything, we should expect the unexpected, and we need to roll with the punches to get ahead.

If you’re in a position to think of giving back to your community this holiday season – we can tell you it’s far more rewarding to give than to receive. And if not, that’s cool too – sometimes you have to concentrate on yourself, and the holidays are an excellent time to do that.

It’s also a great time to reflect. What goals did you accomplish this year? What do you need to work on? Remember, it’s never too late to get started, especially if you have the right mindset.

And, of course, make sure your family is covered by getting your savings in the right place for long-term success. We want to help you and build our community, and if you’re going to get started, feel free to set up a time to chat.

If you have a student loan, some good news! (for once…)

Actionable Items for You:

  • Interest and payments are postponed on your student loan until May next year, extended 90 days from February.
  • If you have one, you should take advantage regardless of your financial situation. Interest-free loans don’t come around all that often.


Student loan weighing you down? All good, you’re in the same boat with almost 45 million other Americans. And if you were worried about the coming February 1 end to the pandemic-related pause in loan payments, we have some good news for you: President Joe Biden announced that he is extending the pause until May 1 of 2022.

While this is not canceling your student debt, which everyone would like, it is at least some reprieve. If you have a student loan and are currently paying it off, I suggest you take an entire look at your finances before sending another dollar. If you have credit card debt, mortgage payments, or other types of interest-bearing debts, pay those first. In addition, while it’s not a long time, you could get started or continue your savings journey with a few extra monthly contributions instead of paying off your student loan.

The reason? Free money doesn’t come by often, so you should take advantage when it does. Make sure you have a plan in place for May when the interest starts to accrue, but be smart with your money until then.

Need some advice on where to start? We can help with that. Feel free to set up a time to chat

Things to be aware of…

Self-employed & saving for retirement?

 

Actionable Items for You:

  • Saving for retirement as a self-employed individual can seem daunting, but it is important. 
  • There’s a lot to know, but it’s less complicated than you think. And we can help.

If you are in the beginning stages of your business, saving for retirement may not be top of mind. But if your cash flow is steady, you may be ready to start implementing a retirement savings plan. 

Your retirement doesn’t need to be complex or burdensome. Adding a retirement plan can help build your savings and, depending on which plan you choose, can also help reduce your tax bill.

You will want to consider the following items when implementing a retirement plan as a small business owner:

  • Do you have any employees?
  • How much you can contribute to your retirement plan?
  • Your annual income

Once you have those at least in general terms, you can start to attack your retirement savings plan step-by-step. The four main accounts you need to be aware of when saving for retirement as a self-employed individual are:

  1. IRA
  2. Simple IRA
  3. SEP IRA
  4. Individual 401(k) and defined-benefit plans

With these, you can contribute anywhere from $6,000 per year to nearly $300,000 per year. Those numbers can add up large over time, and the earlier the better. You can learn more about those accounts here, but just know taking the first step is the most important. And if you want to simplify it, we got you. 

Do you want some help with starting your retirement savings? We’re here to help. Schedule an Intro Call Today.

Want to help us? Share this with your friends and family. 

Weekly Market Recap – 12/20

60 Second Market Review

What happened?

  • Getting used to the zig and the zag yet? Markets went down this week, but it might not be because of Omicron. Hint: The Federal Reserve did something this week.
  • Markets have had major crashes more than you think – and recovered to all-time highs every single time. The urge to sell is often the most at the worst time.

Things to be aware of…

  • Turning your side gig into your full-time gig
  • Want to double your wealth? Forbes says those with a plan have double the wealth than those without one. Get your financial plan today.

The Details

What happened? 

Getting used to the zig and the zag yet? Markets went down this week, but it might not be because of Omicron. Hint: The Federal Reserve did something this week.

Source: Ycharts

 

Actionable Items for You:

  • Markets sold off this week as volatility continues to be the name of the game for December.
  • It might be more related to what the Federal Reserve is doing than Covid-19 – although both do not help. Don’t stress too much – the S&P 500 is still positive in December.

Where is that Santa Rally? Markets sold off this week to the tune of 1.7% to almost 3%, depending on which major index you are looking at. And just like you, we’re starting to get some dizziness from all the whipsawing of the markets in December. 

What was the cause this week? A few things working together, or so it seems. The Omicron variant of Covid-19 appears to be taking over, now in 89 countries according to the WHO (and counting). Governments are responding with local tightening of restrictions, cancellations of holiday plans including New Year’s Eve parties, and it’s starting to feel a lot like March 2020 again. That, and inflation is running rampant, causing concern for policymakers – including the Federal Reserve. 

Speaking of which, that might be the reason we’re seeing increased volatility lately. The Federal Reserve had a major pivot this week, speeding up its monetary tightening by forecasting more interest rate hikes next year, and aggressively slowing down their bond-buying moves (that provides liquidity to banks, spurring activity in the economy). 

Why is that such a big deal? Have to raise rates eventually, right?

Well, historically, markets have not done super well when interest rates are being hiked – with a caveat. It’s when the Federal Reserve hikes interest rates too fast, or too high, that stocks tend to pull back.

Why does that happen?

Raising interest rates increases the cost for companies. Think of it as a mortgage – if your interest rate is higher, you’re going to have a harder time affording that monthly payment. It’s the same for companies – they borrow money to start a business, pay their employees, or expand operations. If it costs more for them to borrow, they don’t make as much money. When you don’t make as much money, your company isn’t worth as much – making the stock drop. 

The reason tech stocks and the Nasdaq index (which is heavy on tech companies) drop more, is the more you are a growth company, the more your earnings are expected in the future. Future earnings are discounted more, so a small hike in interest rates can cause a larger effect on future earnings. 

Let’s not get too worried, though. The S&P 500 is still up 1.2% for December, and that’s the type of investment you should really be in. 

Want to know how we strategize your investment portfolio long-term? Feel free to set up a time to chat

Markets have had major crashes more than you think – and recovered to all-time highs every single time. The urge to sell is often the most at the worst time. 

Source: Investopedia

Actionable Items for You:

  • There have been several market crashes in history, and they all have one thing in common: new all-time highs were made after them.

Time for a stock crash history lesson, for those worried about markets. Market crashes are not new, in fact, here are a few major ones:

In 2020: -34%
I
n 2008: -56%
In 2000: -49%
In 1990: -20%
In 1987: -34%
In 1980: -27%
In 1973: -48%

Rough. If you invested at the peak before any of those selloffs, you probably wouldn’t be too happy. And many market commentaries say we’re on the precipice of another one. 

Even we say there will be another one. Because historically there always has been at some point. 

Do you know what all of those crashes have in common, though? 

They were all followed, at some point, by new all-time highs in the markets. That’s right, a recovery past their peaks and to new ones. 2020 is the most recent example in history, but it has happened several times before.

So be patient, stick with your strategy, and invest long-term and you will be ok. Don’t worry too much about today’s market worries, as there will always be something causing concern, and more often than not the markets simply ignore it and push higher.

And if it doesn’t, don’t panic. Crashes happen, but they have all been followed by new market highs (eventually). 

Let’s get you started on your financial future. Feel free to set up a time to chat.

Things to be aware of…

Turning your side gig into your full-time gig

Actionable Items for You:

  • Going from side-gig to full-time gig? Make sure you take care of some administration before you take the plunge. 
  • When you leave your full-time job, you might need to get your own health and life insurance. Cover all of your options ahead of time. In addition, keep those retirement savings going.  

So you are thinking of taking the leap and making your side gig your full-time gig. Congrats! Of course, it can be difficult to make this jump and it is extremely hard to find the right time, especially if you have a family or more people counting on you. 

Here are some signs you are ready to make the change:

  • You enjoy your side gig more than your 9-5.
  • Your side gig is so busy it feels like you have two full-time jobs.
  • You can reasonably live on what your business is making right now.

That’s a great start. However, make sure you consider a few things before leaving your day job. Once you’re on your own, you’re going to have to replace those employer benefits, and some of them are extremely important. Here’s a quick checklist:

  • Health Insurance: If you are married, maybe you can be added to your spouse’s employer plan. Single? Look into individual plan options (we can help with both of these).
  • Life Insurance: Is your employer’s policy portable? Might be a good option. If not, get some term life insurance quotes to replace the coverage you get through your employer. (again… we can help you with this!)
  • Retirement Savings: You have to keep your future self’s retirement on track. Keep up your contributions by opening a traditional or Roth IRA, depending on your situation. 

Now that that’s all done, a couple of things might help you work smarter, not harder, with your side-gig-turned-full-time-gig. 

Look for an assistant, or invest in a way to automate your social media. Hire a freelancer for some tasks you can outsource. If you want to level up the business, the only way is to free up your time for more important tasks.

Leaving your full-time job to be a business owner can be challenging.  Make sure you are up to the challenge by giving yourself time to let your side-gig grow while making a plan to ensure you have a successful transition. 

Do you want some help with covering your transition for your side-gig? We’re here to help. Schedule an Intro Call Today.

Want to help us? Share this with your friends and family. 

Weekly Market Recap – 12/13

60 Second Market Review

What happened?

  • Just when you thought the market was scared… The December Effect comes into full force, another record close for the S&P 500
  • With 20 years to invest, how much can your portfolio make? 

Things to be aware of…

  • Picking a business name and entity – a not so easy task, but important. It’s your brand. And there’s more to do after. 
  • Want to double your wealth? Forbes says those with a plan have double the wealth than those without one. Get your financial plan today.

The Details

What happened? 

Just when you thought the market was scared… The December Effect comes into full force, another record close for the S&P 500

Source: Ycharts

Actionable Items for You:

  • Well, just when everyone thought the market would keep going lower… it regained its yearly highs.
  • Only 11% of paid money managers beat their benchmark long-term – why do you think you can? Passive investing is the key to financial success.

How’s that for a turnaround? We mentioned in the last two weeks that the best thing you can do in times of market jitters is to do nothing, and this week bore fruit for us. Stock markets surged, with the S&P 500 gaining 3.8%, the tech-heavy Nasdaq index gaining 3.6%, and the Dow Jones Industrials gaining over 4% for the week.

What happened? Well, in contrast, there was a pretty high inflation reading for November – the highest in 39 years – at a 6.8% increase over last November’s inflation. This was slightly higher than expectations at 6.7% as well, something which you would expect the market to sell off on.

Of course, it didn’t, and the market took it in stride, pushing to a new closing record on Friday. 

What gives? Well, first, remember that nobody is smarter than the market, so thinking you know what the market will do is a fool’s errand. In fact, even those highly-paid money managers tend to underperform, and it’s not particularly close.

Check this stat: only 11% of actively managed large-cap funds outperformed their passive peers over 10 years.

What?? Some of these managers get paid literally millions to do what they do. And only 1 out of 10 can beat a cheap (almost free) index investment that they are compared to. 

So when you hear your friend or family member talking about the next big stock, or how they’ve got the secret stocks, remember that stat. If almost 90% of paid money managers can’t beat their index, what makes you think your Uncle is, over the long term?

We don’t know when the market will go through another correction (10% loss), or even another bear market (20% loss). It will happen, that is for sure. But thinking you know when that will happen is, clearly, not a profitable venture. What is profitable is staying invested long-term, and sticking to your strategy.

 

Want to know how we strategize your investment portfolio long-term? Feel free to set up a time to chat

With 20 years to invest, how much can your portfolio make?

 

Source: Ycharts

Actionable Items for You:

  • In a 20-year period with the Tech Wreck and terrorist attacks in 2001, the financial crisis in 2008, and the covid-19 pandemic you would think stock markets would have poor returns, right? Wrong. 
  • We can’t guarantee the next 20 years will be as good, but we’re pretty sure they won’t be bad. 

Sometimes, sticking to that investment strategy is more important than the strategy itself. In the most recent 20-year period, from 2001 to 2020, there were three bull markets and three bear markets – with a number of major downside events (known as “black swan” events). The Tech Wreck and terrorist attacks in 2001, the financial crisis in 2008, and the covid-19 pandemic. You’d expect returns to be pretty bad over that period, right?

The S&P 500 returned an annualized 7.46% in that time, for a total return of 322.3%. And for those paying attention, 2021 is a pretty good year too, adding to those numbers: 

At the end of the day, we know that being patient and calm during extreme volatility can lead to some pretty incredible outcomes for you and your family in the long run. Let’s get you started on your financial future. Feel free to set up a time to chat.

Things to be aware of…

Picking a business name and entity – a not so easy task, but important. It’s your brand. And there’s more to do after. 

Actionable Items for You:

  • Naming your business is step one on the new journey, whether it be for a side hustle or long-term career. 
  • There are a few other things you need to do after picking your business name – getting that business bank account is key to staying organized. 

When you’re starting your business, one of the first things you have to do is pick what your name is going to be. While this is an important task, and you shouldn’t take it lightly, you should try to have some fun with it. When you’re brainstorming, remember to be creative. And if you get stuck, try a free business name generator like this one from Shopify: https://www.shopify.com/tools/business-name-generator 

That’s step one. Step two, after you’ve found a name and brand you like, don’t get too attached yet. You have to check its availability. If you’ve passed through the hoops, it’s now time to register your business name.

Who knew starting a business had so many rules?

Once you’re good and registered, you have to choose a business type, and the best way to do this is to shortlist business types with pros and cons. You need to do this before opening a business bank account.

Why is a business bank account important? Really, accounting. You need to keep your business income and expenses separate from your personal income and expenses, and the easiest way to track this is to simply separate them. This will help stay organized and make filing your taxes easier, saving you some valuable time to keep working on that side hustle. 

Do you want some help with your business name and getting set up? We’re here to help. Schedule an Intro Call Today.

Want to help us? Share this with your friends and family. 

Weekly Market Recap – 12/06

60 Second Market Review

What happened?

  • What do a jobs report miss, Omicron variant, and no longer “transitory” inflation do to stock markets? Here’s why you shouldn’t worry too much, despite a recent pullback. 

Things to be aware of…

  • Funding your side business – Financial Planning and Time Management
  • Want to double your wealth? Forbes says those with a plan have double the wealth than those without one. Get your financial plan today.

The Details

What happened? 

What do a jobs report miss, Omicron variant, and no longer “transitory” inflation do to stock markets? Here’s why you shouldn’t worry too much, despite a recent pullback. 

Source: Ycharts

Actionable Items for You:

  • Again, stocks were down this week due to a big-3 – the Omicron variant, a jobs report miss, and inflation. But how much were you down? If you’re appropriately diversified, probably not that much. 
  • Markets are still having a banner year, and December is a positive month 74% of the time in the last 100 years – you know what to do. 

A lot happened in the last week of note, and markets were not enjoying it. The S&P 500 dropped 1.2%, the Dow Jones dropped 0.9%, and the tech-heavy Nasdaq index dropped over 2.6% for the worst performer of the bunch. 

What happened? A few things together, at least on the surface. The world is worried about the Omicron variant of Covid-19 leading to further lockdown restrictions, although we are a couple of weeks away from really knowing. The monthly jobs report for November came in far less than expectations, with just 210k jobs created versus expectations of 573k from Wall Street. And to top it all off, inflation has been running hotter than expected for longer, and Federal Reserve Chairman Jay Powell stopped calling it “transitory” – thus hinting at hiking interest rates to slow down the economy sooner than expected. 

That’s what we call a trifecta of bad news. 

However, while the markets are off all-time highs, it’s still not time to worry. The reason is timing the market is inherently complex; some say impossible. And while there could be more downside days like today, December is generally not a month you want to be in cash.

Source: Bespoke Investment Group

December has historically produced positive returns 74% of the time in the last 100 years. Not only that, if you’re investing in a diversified portfolio as we profess, your returns will be more geared toward the S&P 500 type returns versus the Nasdaq, and you won’t be taking on as much risk overall. That means you probably didn’t notice much of a value change in your investments (depending on how aggressive you are). 

It also helps to keep in mind how well the markets have done this year. 

Source: Ycharts

Even after this multiple-week pullback, the S&P 500 is still up 20.8% year-to-date. 

It’s also good to remember that the stock market pulls back 5% almost every year, 10% every other year, 30% every 4 to 5 years, and 50%+ once a generation. 

You know what to do: stay invested, stay the course, and get long-term financial freedom. 

Want to know how we set up our portfolios? Feel free to set up a time to chat.

 

Things to be aware of…

Funding your side business – Financial Planning and Time Management

 


Actionable Items for You:

  • The first step to any business is knowing what funding you need upfront. Planning for it in advance can help. 
  • Getting going can take some time, so be prepared to put in the work. Time management and managing your productivity are key. 

Last week we accounted for start-up costs for your new business. This week, we want to discuss financial planning and time management for your side business. Now, we need to plan to cover these expenses. 

Financial Planning

The first step is to consider your sources of funding. If you have savings to cover your start-up costs, awesome! If not, it is a good idea to put a plan to save up for the costs. Keep in mind, this savings plan should not replace an emergency savings plan, something all of our clients at Freeman Capital are encouraged to do.

One thing to note – if you’re taking on a side hustle for financial reasons, it’s important to remember that you may not start making money right away. Building up a network and contacts takes time, and profits may be slow when you’re starting out. It’s exciting, but if you’re serious about getting some extra cash, you have to put in the work.

The next financial consideration to keep in mind is your cash flow. Also called your working capital, your cash flow is how much you need to keep your side hustle running day-to-day. These costs need to be laid out as part of your operating expenses. Operating expenses will give you a baseline of how much cash you’ll need, at a minimum, each month to keep your business going.  

You will need a plan for staying on track with your cash flow. That’s where your business budget comes into play. Having a solid business budget is essential to the success of your business, allowing you to manage your business finances properly and stay on top of your expenses.

Time management

While the financial side is important, there is one finite resource – Time. Consider how much time and when you will work on your side business. 

Taking on extra responsibilities will always demand sacrifice, but weighing the potential consequences is essential. Will it negatively affect your family life, for instance? If your day job often requires overtime or frequently being on call, this may make side hustling difficult. Start with a calendar and utilize some time tracking tools.

Whether you use a digital or physical calendar, your first step should be blocking out the hours you’ll be doing your day job, followed by any other commitments (social, family, or otherwise) that will take up your time.

Once you’ve done this, you’ll need to break down the demands of your side hustle into separate tasks to be completed, whether these are recurring or simply one-off. You’ll not only make everything feel a little more manageable, but afterward, you’ll also be able to work out where in the week you’ll have time to complete them. Scheduling apps like Timely are great for this purpose, allowing you to create to-do lists and then drop and drag tasks from them straight into your calendar.


Managing productivity

Track your time to see how you’re spending your productive hours – it’s beneficial to see how long you’ve spent on a given task and where you get distracted. Or if you’re playing too many video games or scrolling on Instagram… 

Working out a good, productive balance between your side hustle and your primary job will require an adjustment period, so don’t be disheartened if you’re finding things difficult at first.

You can ease this adjustment by reflecting on how you’ve used your time. In particular, check what you planned to do against what you ended up doing, how long different tasks took you, how much “deep work” you were able to do, and what routines worked best for your focus.

Do you want some help planning for your side hustle? We’re here to help. Schedule an Intro Call Today.

Want to help us? Share this with your friends and family. 

Weekly Market Recap – 11/29

Week in Review – November 29, 2021

60 Second Market Review

What happened?

  • Stocks closed sharply lower on Friday for the biggest drop of 2021. How bad was it? 

Things to be aware of…

  • December is coming. We’re going to talk about business ownership, starting with our Side Gig Guide this week – getting started. 

  • Want to double your wealth? Forbes says those with a plan have double the wealth than those without one. Get your financial plan today.

The Details

What happened? 

Stocks closed sharply lower on Friday for the biggest drop of 2021. How bad was it? 

 

 

Source: Ycharts

Actionable Items for You:

  • Stocks dropped sharply on Friday, and there’s one thing you should do: probably, nothing. 

  • While this may not be the end of a pullback, 90% of active managers underperform passive index funds. If you can’t beat them, join them. 

 

If you’ve been sleeping all weekend, you probably aren’t aware that there was another Covid-19 variant discovered in South Africa last week, one of major concern. And while we’re not going to go into specifics on what it is here (nor, are we equipped to), we do want to take a look at how it can potentially affect your finances. 

 

First of all, the numbers. Markets dropped sharply on Friday, with the Dow Jones Industrial Average having its worst day of 2021:

 

Source: CNBC

 

While that probably hurt your unrealized gains for the year, it’s important to know that it probably didn’t affect you all that much. If you have a portfolio that is taking on 75% of the risk of the market, and 25% of your money is in cash or fixed income, you probably felt about 75% of the downside. In addition, the market is now trading at the same level it was at in… October. 

 

Freeman Capital clients know what to do here to take advantage. And it’s not to use leverage, find some crazy get rich quick scheme, or sell out of all your stocks to protect yourself from losing any money. No, the right answer is… do nothing. 

 

We’re not saying this market selloff is done – it could certainly continue after the market has rallied impressively this year in the face of shutdowns happening across the globe with a surge in coronavirus rates, still troubling supply chain issues, and now this new variant of concern. But what we do know is that in 10, 20, and 30 years from now, not many people will be talking about November 26, 2021, as the day to go to cash and never buy stocks again. 

 

So doing nothing, not trying to time the market, will be the best strategy long term. We’re talking about passive investing, something that has outperformed expensive money managers over 90% of the time over a 20-year period according to the S&P Indices Versus Active (SPIVA) report from S&P Dow Jones Indices. That’s just math. All you have to do is be patient, invest properly, and stay invested.

 

Want to know how we set up our portfolios? Feel free to set up a time to chat.

Things to be aware of…

 

December is coming. We’re going to talk about business ownership, starting with our Side Gig Guide this week – getting started. 

 

Actionable Items for You:

  • Millions of people are quitting their jobs and going full-time on that side gig – we’re going to talk about business ownership in December.

  • Getting started you should run through a business plan – something to get your ideas on paper and really get the momentum started. 

 

During the pandemic, millions of people started a side gig to make some extra cash, with some having left their full-time jobs all together. We’re in what’s now known as The Great Resignation – a record 4 million people quit their jobs in July 2021 alone. And while some went off to start new full-time jobs, a good amount turned their pandemic side gig into a full-time business. 

 

In December we want to talk about business ownership. This could be a side gig to supplement your 9-5 salary or starting a full-time business. While learning on the go is one way to go about it, there are some things you need to have in place in order to establish your successful side hustle. 

 

Basics first – start with a business plan. Your plan needs to focus on the key things that will help you build a successful business. Putting your ideas on paper makes your business come to life, and this will help you better determine what you want and don’t want in your business. You might even come up with completely new ideas. 

 

 

Your business plan does not need to be complicated but it should address the following: 

 

Who, How, What 

  • What do we do?

  • How do we do it?

  • Who do we serve?

 

Why

  • Define the customer problem

  • Define the solution you will provide

 Revenue

  • Your pricing and billing strategy

  • Income Streams 

 Marketing

  • Customer reach strategy

  • Referral generation strategy

 

Competition 

  • Top competitors

  • Your competitive strategy 

Metrics

  • Success milestone 1

  • Success milestone 2

 Next in your plan, you should budget for startup costs. A few costs to consider for your preliminary side hustle budget may include:

 

  • Office equipment

  • Technology such as a computer or mobile phone

  • Materials you need to buy

  • Preliminary marketing expenses (such as the cost of website, building software, and registering your URL and online ads if you are buying any)

  • Costs associated with registering for online freelance platforms or marketplaces you might use to find customers

  • Accounting software

 If you’re interested, we have a great excel template for you to ‘borrow’ – hit us up and we’ll shoot you a copy.

 

Do you want some help getting that side gig started? We’re here to help. Schedule an Intro Call Today.

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