One of my core beliefs is to be optimistic. Another is to be grateful. My family and I have it pretty good. I work hard to remember that, and to appreciate it.
And, I’d like to share a little optimism with you. So, here are 10 Reasons to be Optimistic About Your Financial Future.
- The United States is a net oil exporter. I can remember the Arab Oil Embargo of the 1970s. I was in junior high looking forward to getting a driver’s license when the price of gasoline doubled. Today theS. Energy Information Administration says the U.S. is a net petroleum exporter. Exporting 1.26 million barrels/day in 2022. The breakeven price for oil produced by fracking is about $50/barrel and West Texas crude oil sells for about $73 a barrel.
- Bank Savings Accounts Pay Interest Again. Depositors can get yields around 5% on one-year CDs as reported by Bankrate as of mid-April. When was the last time you saw 5%?
- Inflation is moderating. Inflation was about 5% in March. I can remember people taking mortgages at 18%. Inflation is up, but it’s NOT that bad. Overall trend seems to be headed in the right direction.
- Companies are great at passing along costs. Recent stock earnings show that most companies are making money. Just look at prices at the grocery store for proof that companies are great at passing along higher costs.
- Look for Companies With Lower Prices. Prices in the grocery store may be higher but you might find a local company looking to build market share with lower margins. One example is ALDI, the German grocery chain showing up in many U.S. towns.
- The Federal Reserve is not run by dummies. The Federal Reserve has seven governors. The Fed has 400 economists with PHDs. The Fed employs about 3,000 people in Washington. This is a serious, independent organization that puts a lot of thought into its decisions.
- Companies know how to cut expenses to boost profits. Many of the best companies in America have been around for decades. In order to survive that long they have navigated many economic challenges. I am confident that our best companies will ride through the coming recession and be stronger on the other side.
- Stocks of U.S. companies have been the best source of growth for years. Just look at the Ibbotson mountain chart that shows the growth of investments over the last century. Although past performance is no guarantee of future results, history shows that buying and holding quality stocks has turned out pretty well.
- The U.S. dollar is the world’s reserve currency. Some people worry that foreign governments own a lot of U.S. Treasury securities. The total is about 24%, according to the U.S. Treasur The reason so many countries want to own U.S. Treasuries is that they have faith in the U.S. economy. Oil might come from the Middle East, but it is priced in dollars. Investments in the U.S. are considered a “safe haven” when the world is unsettled.
- The U.S. Economy is Quite Healthy. The Economist magazine’s April 15th cover story is “Riding High: The Lessons of America’s Astonishing Economy.” The article notes that “Average incomes have grown much faster than in Western Europe or Japan. Also, adjusted for purchasing power, they exceed $50,000 in Mississippi, America’s poorest state—higher than in France.”
We all have plenty for which to be grateful.
If you are thinking about your financial goals and would like the perspective of an experienced, well-trained CERTIFIED FINANCIAL PLANNER™ professional, give me a call. I am an advocate for all my clients and I always like to meet new people. Just follow this LINK to find a time that works for you.
Yes, I am a CERTIFIED FINANCIAL PLANNER™ professional. I’m always a fiduciary and I work on a fee basis. And yes, I’m still taking on a few great families to be part of my financial planning practice.
If this article has you thinking about your own circumstances, contact my office at rdunn@dunncreekadvisors.com. I am always happy to meet with people who are working on their retirement plans. Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.