With the recent announcements of Instacart and ARM seeking to make their debut on the public equity markets, the IPO gate may be re-opening after closing through much of the last year and a half. And in the dynamic world of tech startups, pre-IPO employees have a unique opportunity to build substantial wealth through their company's equity compensation.
For long-term investors, understanding what can and cannot be controlled is the key to financial success and peace of mind. While all investors would like to believe they can predict or even control the market's direction, experience teaches us that this is difficult. Constructing and risk managing an appropriate portfolio, while making strategic and tactical allocations based on market opportunities, ideally with the guidance of a trusted advisor, is often the best approach. However, while following markets and maintaining a perspective on the economy is essential, an even more fundamental key to success is investing early, investing often, and remaining focused on long-term financial goals. What can investors do to benefit from these principles today?
On August 1, Fitch, a credit ratings agency, downgraded the U.S. debt from AAA (the highest rating) to AA+. Fitch had warned of a possible downgrade during the debt ceiling crisis earlier this year and has sounded alarms since 2011, when a similar crisis occurred. While few investors, economists, and business leaders view the downgrade itself as meaningful, primarily because AA+ still represents an extremely low default risk, that does not mean it has not impacted financial markets. After all, investors have benefited from markets mostly moving upward this year, leaving some investors unprepared for even small stock market swings. What drove the downgrade of the U.S. debt, and how can long-term investors maintain a balanced perspective?
Market and economic expectations have shifted 180 degrees since the start of the year when many investors expected a recession and prolonged bear market. Ongoing economic growth, low unemployment, improving price pressures, and slowing Fed rate hikes have spurred a strong market rally, especially across sectors that struggled last year. While the economic situation is far from perfect, and investors should always be prepared for uncertainty, it's also essential to recognize the positive trends raising the odds of a "soft landing." What factors are driving these changes in investor expectations?
Celebrating as a family member graduates high school and attends college is a monumental event and the culmination of years of hard work. However, paying for college remains a significant source of stress for many households. It's no secret that college costs have risen much faster than inflation over the past 40 years, increasing the financial burden on families as they set money aside and on graduates once they enter the workforce. And yet, there are numerous professional and personal benefits to pursuing higher education for those who wish to do so. Weighing the costs against the benefits while considering personal priorities and the broader economic picture makes college planning a complex topic.
Planning for retirement for mid-career tech professionals has never been more important and yet so challenging. Given the problematic inflationary conditions of the past two years, the risk that worries most continues to be outliving their savings. This is because, when it comes to markets and the economy, we can't control the timing of events - including day-to-day market swings and whether investors begin retirement in a bull or bear market. What we can control, however, is our own behavior by staying disciplined. While there are never any guarantees, history shows that having a sound financial plan that can adjust to changing conditions, accompanied by proper financial guidance, is the best way to minimize retirement risks.
Spring is the perfect time to freshen up not just your home but also your finances. As a tech professional, you work hard to build a successful career and secure your financial future. However, just like your physical space, your wealth plan may also need some spring cleaning to ensure it is in optimal shape.
In times of market uncertainty, investors often turn to sayings such as "those who fail to learn from history are doomed to repeat it" and "history never repeats itself, but it does often rhyme." When it comes to the daily headlines, both quotes are relevant, given the long history of banking crises and market swings.
I've been in the workshop, choppin' wood for a year now since launch. So much so that I managed to fly by the official 8.17 public launch anniversary without even so much as a thought. Not until the start of this month, when I take stock of the previous month and chart out the next, did I remember. I'll spare the metaphors and hyperbole, as I think they are often overused and are disserving to the original context. So I'll just state it plainly, I've been grinding it out for my clients and future clients.
Be a Tracker, in Life and in Wealth. How the art of Tracking relates to the art of Wealth generation.