Lately, I’ve been thinking about why it is so ingrained in our human nature to worry. We’re a nervous species, fearing uncertainty, volatility, and anything that we can’t control. I’m in a business that exists primarily to take financial worry off the shoulders of our clients and manage it ourselves, but we live in a media environment that seeks to capitalize on fear without looking at the greater picture.
There’s an old trope in the financial planning industry — Nobody likes to work with engineers.
They say engineers ask too many questions. They come in with complex plans for exactly when and how they should retire to maximize their post-career income. They have dozens of spreadsheets taped together detailing every cent of their savings and budgets and interest payment projections. Heck, I’ve seen it myself. They’re trying to play financial advisor for the first time, and I can tell you that it’s not an easy job.
But at Family Financial Partners, we love working with engineers.
Next weekend we officially enter the fall — one of the best times of year that ushers in football, fire pits, and the beginning of the holiday season. As you watch the leaves turn brilliant red and orange and begin to blow to the ground, it’s easy to appreciate the natural beauty of the end of another life cycle before the cold winter months.
It’s much harder to appreciate nearing the end of our own life cycles. As a matter of fact, most of us probably avoid thinking about it altogether. And that’s perfectly understandable. None of us wants to consider that one day we won’t be around anymore and our loved ones will be left to pick up the pieces. Heck, I’m sorry for even bringing it up today. But it’s just the reality of the human condition.
Here in Lexington, Kentucky, we may be in the dog days of August, but it just feels a little different this year, doesn’t it? I can almost sense the coming fall air as folks around me are preparing to go back to school and talking about University of Kentucky football. The Family Financial Partners team is making its way back to the office, and clients are starting to answer our phone calls as they settle into a normal schedule.
This has been a really interesting year watching the discussion of artificial intelligence advance due to the rise of ChatGPT and similar machine-learning tools that have permeated daily life and business. In order to learn more about the subject, I recently invited Brad Watkins, a self-described “technology evangelist” to our podcast, “In My Day.” Ryan and I had a fascinating hour-long discussion with him where he broke down what AI really is and how it’s going to affect our lives moving forward. I thought that, for this month’s newsletter, you’d like to read an excerpt from that conversation.
Last week was a big one in the market. We had a new bull market declared, and we saw the Federal Reserve finally pause its year-plus campaign of hiking interest rates. Let’s deal with the Fed first:
No rate hike, but are more coming?
While it did not raise rates, the Fed did raise its terminal interest rate, which is its target for where it sees interest rates going, by 50 base points, or a half percent.
I love summer because we have all these opportunities for how we can allocate our newly found free time, but I find when I talk with clients that summer can also be a stressful season. There’s always the pressure to plan that big vacation that we can forget to budget for it and end up paying for that vacation for the next six months. In my case, I’ve got three kids doing camps and getting braces and moving into dorm rooms — there isn’t much money left for the “what Dave wants to do” fund!
I’m hearing from a lot of you who are concerned about the debt ceiling battle in Washington and what it might mean for you if the two sides can’t come together on a deal before the U.S. defaults on its bills.
In my view, the whole rodeo is being blown out of proportion by the media as it floods us with what-if scenarios. There is a history of presidents having to work with a hostile opposition party in Congress when up against the debt ceiling. The only solution is for both parties to agree to raise the debt ceiling and then focus on a truly balanced budget.
So much of gardening is the hard work and growth that takes place underneath the soil — feeding and nurturing our plants so they can build strong roots that will sustain them long after our work is done, allowing us to sit back and enjoy the fruits of our labor. Nobody ever comments on the roots, on the quality of the soil, or on the weeding we did that gave them room to grow. All they see is the beauty that lives above the dirt — the finished product.
Sometimes the best-laid plans don’t work out as you expected. My mother always said, when things don’t go your way, consider the “why.”
I believe that the Federal Reserve would do well to consider that message. We’ve just gone through a banking crisis caused in part by the Fed aggressively raising interest rates, which resulted in the closure of one of the largest banks in the U.S. and the sharpest decline in commercial lending on record. In the meantime, wage inflation and housing costs remain stubbornly high, while unemployment is historically low.
*Representatives are licensed to offer insurance and annuity products in AL, AR, CO, FL, GA, IN, KY, MA, MD, MI, MO, MS, NC, NH, OH, PA, SC, TN, TX, WV, VA, and WA and are licensed to offer investment products in AL, AR, AZ, CA, CO, CT, FL, GA, IL, IN, KY, MA, MD, MI, MN, MO, MS, NC, NH, NM, NV, NY, OH, PA, SC, TN, TX, UT, WA, Washington DC and WV. This website and its content are not intended for residents of other states. Securities offered through: The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way, Cincinnati, OH 45242. 513.794.6794 Investment Advisory Services offered through The O.N. Investment Management Company. Estate Planning Services provided in conjunction with your licensed legal advisor.
