Opinion
By Steve Nicklas, 1-3-25
Most of us approach the new year with wide-eyed excitement, as nostalgic memories from the past year fade away.
You would be wise to capitalize on the new-year vigor with self-improvement strategies, especially with financial matters. Here are strategies I’ve honed over 30 years as a decorated financial advisor.
1- Do a personal financial review. Look at what worked last year and what didn’t. While indexes like the S&P 500 soared for a second straight year, other investments struggled such as bonds.
2-Rebalance your holdings. It usually makes sense to take some profits on your winners and add to your losers. In this way, you lock in gains and use the proceeds to buy more of an underperforming investment at a lower price.
3-Identify favorable trends for the new year. For instance, smaller companies excel in a growing economy, which we expect with a pro-business administration focused on cutting taxes and regulations. As far as sectors, utilities should benefit from lower interest rates and the emphasis on AI, which requires massive amounts of electricity. Avoid pharmaceuticals and defense contractors with political whirlwinds. And emphasize the flourishing U.S. versus sluggish overseas markets.
4-Develop a financial plan. This will serve as a road map for your financial journey. Use reasonable assumptions and don’t insert unrealistic goals. You could spend as much time in retirement as you do working.
5-Insurance helps protect you on a rainy day. Life insurance replaces lost income from an untimely death. Annuities can provide a guaranteed income in retirement.
6-Adopt a reasonable family budget. Invest regularly to benefit from dollar-cost averaging, and maximize retirement accounts for the tax advantages and employer matches.
7-Trim household expenses by streaming and cutting the cord, buying groceries at discount stores like Aldi, and reducing interest rates you are paying.
The new year should be wondrous in so many ways. The political revolution will produce a renaissance of prosperity, with a secure border and peace around the globe. We are so fortunate as Americans.
Steve Nicklas is a decorated financial advisor and award-winning columnist in Nassau County. He can be reached at 904-753-0236 or at [email protected].
The views expressed in this commentary are those of the author and do not necessarily reflect the official position of Citizens Journal Florida
