The end of the year is a time of holiday cheer, introspection, and Wall Street strategists’ predictions for the market. As I try to emphasize to my clients, those analyst projections are nothing more than guesswork, wishful thinking, and marketing. They should not be considered investment advice.
A more practical outlook for 2025 is to focus on events that have a high probability of coming to fruition. Preparing mentally and positioning your portfolio accordingly will help set folks up for financial success in the year-ahead. Below are predictions that will likely occur.
1) There will be bad news: when bad things happen, the media loves to inform about it. After all, negativity attracts more clicks than positive news. More eyes mean more advertising income. It is an undeniable business model. Financial media are not other than classic media. The commentators will repeat the same bad inflation figures or falls from the stock market until there are new negative news that they can share with their audience.
Investors will not have to forget that despite what is happening in the world, markets and humanity have prevailed. Obsessing over every scary headline would not possibly replace this reality. Stay positive, and over time, life and your wallet will get better. They do.
2) There WILL be major global events that nobody predicted: Record high inflation, war, a global pandemic, the implosion of a cryptocurrency, a global pandemic and so on. There are many things that will take place in 2025 that are unpredictable. These may be negative events, like I just mentioned. It may also be positive news, like a strong economy and a record-setting year in the stock market. It’s not the investor’s job to foresee these big events. That’s impossible. Rather, investors should focus on structuring their portfolio to withstand whatever awaits them and keep their emotions at bay. Doing so will position investors for long-term financial success.
3) Your know-it-all brother-in-law/friend WILL have a great investment opportunity that they can get you access to: The question I receive most is whether someone should participate in an opportunity suggested by someone close to them. The answer is almost always NO. Envy and speculation are two things that keep the world turning. This won’t change. In social settings, whether it’s on the golf course or a dinner with friends, it is common for people to want to share their investment winners, while conveniently leaving out the losers. These stories make others jealous. It’s important to remember that you don’t need “access” to anything special to achieve your goals. Your process should be boring, plain vanilla, and consistent over time. If your strategy represents that level of dullness, then you are likely to minimize your mistakes and build wealth overtime. Don’t let anyone with a hot deal try to convince you otherwise.
4) Your brother-in-law/know-it-all friend will tell you what you do with your personal finances: Remember, personal finances are PERSONAL. What might be sensible for your brother-in-law may not be sensible for you. The cornerstone of any investment strategy is defining your express objectives. Once you’ve explained those goals, you can expand on a strategy to achieve them. Your brother-in-law may have different goals, financial situation, or personal tastes than you. These differences would possibly require another strategy. You will have to look after your own interests and your brother-in-law will have to look after his. Someone else’s strategy often doesn’t make sense to you and your family.
5) YOU WILL NOT achieve good luck in mathematics: this is one of the eternal rules that is always valid. It is worth repeating every year because it is essential to manage your finances wisely. In 2025, if you can’t do anything, you shouldn’t buy it. If you really want to buy it, you want to eliminate anything else from your lifestyle so you can do it. Getting out of debt to a large extent is never the right approach. For retirees, if your spending rate is too high, your chances of outliving your money will increase. For younger people, they may never be able to retire if they don’t appreciate this idea. Delayed gratification and field are not easy, but they are the indicated path to monetary good fortune.
6) If you plan on making “tactical” moves with your portfolio it will likely NOT work out: Tactical portfolio shifts are synonymous with trying to time the market. You may get lucky over a short period of time. However, this strategy will not work over the long-term. Your portfolio should be structured based on your time horizon, risk tolerance, goals, and personal financial situation. It should not be repositioned because an investment strategist pontified on how 2025 will have different “investment themes” than 2024. Wall Street strategist are just as clueless to the new year’s investment themes as the rest of us Stay the course and rebalance your portfolio when necessary. Anything more than that is too much.
7) Most of the expectations of Wall Street’s conceptual leaders will not be correct, but my recommendation will be correct: I may sound overconfident, but my task is less difficult than that of a market strategist. long term with a wonderful degree of precision. After all, express or market functionality is anyone’s guess. Instead, I focused on human habit that has been consistent over time.
Fortunately, the recipe for monetary good fortune is a secret and requires prophetic skills. The formula for building and maintaining wealth is to spend less than you earn and invest your savings prudently and wisely. If you repeat this procedure for decades, it will lead to the creation of a significant point of wealth in the future. Everything else is just noise.
Meanwhile, the biggest revelation about the predictions came from baseball player Yogi Berra, who said, “It’s hard to make predictions, especially about the future. “
Securities filed through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advice presented through Kestra Advisory Services, LLC (Kestra AS), a subsidiary of Kestra IS. ParkBridge Wealth Management is not affiliated with Kestra IS or Kestra AS. Investor Disclosures: https://www. kestrafinancial. com/disclosures.
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