Overwhelmed, but you're not alone To say a lot is going on in the world right now seems like an understatement, doesn’t it? Unfortunately, many people have a lot of fear and anxiety regarding their finances. The stats below from a recent Ramsey Solutions study confirm how many feel about these situations. Most Americans feel similar about their finances After a recent study by Ramsey Solutions, results showed it was common for many Americans to have similar feelings about the world around them and how it affected their bank account(s). 80% of Americans are worried about the economy 3.98MM people/month quit their job in 2021 4MM people/month quit their job in 2022 Inflation is at its highest in 40 years 37% of Americans are struggling or in crisis with their finances 25% of Americans say they’re relying on credit cards more to make ends meet Nearly 4 in 10 Americans have $0 in savings Half of Americans say finances have had a negative impact on their mental health 4 in 10 people have cried or had a panic attack over their money in the last year 82% of Americans are somewhat or extremely worried about their student loan payments restarting There is HOPE While all of these issues exist, there is hope. There is no shortcut or secret. However, we believe the basic principles that Ramsey Solutions teaches work exceptionally well. They are tried and true, straight from God and Grandma. They work 100% of the time. Dave Ramsey calls them the Baby Steps. It doesn’t matter where you are in life; you can begin anywhere and anytime. For those who are serious about getting their financial situation under control, Dave and his team put together a course called Financial Peace University which is a nine-lesson course that teaches you how to save for emergencies, pay off debt fast, spend wisely, invest for your future, and build wealth. If you become a client with us, you will have access to Ramsey+; this membership of Ramsey+ includes access to Financial Peace University so that you can take this course at your leisure. If you want to learn more about the 7 Baby Steps, this article on our website outlines them well. The baby steps are a proven step-by-step plan to help you achieve your financial goals. A common question is, “how long will it take me to pay off debt or build savings?” While everyone’s situation is unique, we have listed the average time frames for people to complete the 7 baby steps below. Again, these are averages, so if you have more debt than the average or make more than an average income, your time frames will likely vary accordingly. Baby Step 1 – Build a $1,000 Emergency Fund - 30 days Baby Step 2 – Get out of consumer debt - 18-24 months Baby Step 3 – Build a 3–6-month Emergency Fund - 6 months Baby Steps 4,5,6 – Intentional until retirement Baby Steps 7 – Live and Give like no one else for the rest of your life If you are feeling stressed and overwhelmed with your finances, we hope this article has let you know that you are not alone but that there is HOPE! Please contact a Financial Advisor or Financial Coach who will help you take the next step in your financial journey. We would be happy to help!

What is a Fiduciary, and Why are they important? Investing can be an intimidating venture, especially when you have no experience. That’s why finding an investment advisor with your best interest in mind is so important – and believe it or not, every firm is not the same in their approach. In this article, we will explore the idea of Fiduciary Duty and what to look for in an advisor. What is a Fiduciary? Simply put, a fiduciary is an advisor who always operates in the client's best interest. You might be thinking, “isn’t that assumed?” Unfortunately, no. There are various approaches to account service and fee structure, and it is important to know the difference. A fiduciary operates with a fee-based approach to their services, communicating in advance what that fee will be and working by the agreed-upon client goals and objectives, and with the client’s risk tolerance and time horizon in mind. A fee-based advisor can structure their fees in various ways, including a flat fee, a monthly retainer, or an hourly rate, to name a few. Of course, in addition to fee-based advisory services, there is also the non-fee-based method. Commission-Based vs. Fee-Based When an advisor is commission-based, there is considerable reason for caution on the client's part. A commission-based advisor doesn’t generally charge a fee to the client; instead, they are paid a commission that comes from accounts opened or financial products they sell, also known as “proprietary products.” When an advisor is paid based on the product they’re selling, it opens up the possibility that they are not selling you the best product for your portfolio. Even if the funds are top-notch, if the funds are from your advisor’s employer, a perceived conflict of interest is inherent. Why is a Fiduciary Important? The bottom line is that if you’re entrusting your money to someone, they should have your best interest in mind. Do you want to be invested in a fund with a good performance track record or a fund that benefits your advisor, regardless of performance? A fiduciary is obligated and bound by their fiduciary duty to operate in your best interest. A fee-based structure allows them to manage this way without being swayed by hefty commissions or other incentives. At Whitaker-Myers Wealth Managers, we believe you should feel confident that your advisor is working for you and your objectives, not against them. Our Chief investment officer, John-Mark Young, expounds on this topic in a recent video from our blog. Our fee-based advisory services come with transparency and an open line of communication so that you can be confident that your money is being taken care of properly. If you want to talk to one of our fiduciary advisors, contact and schedule a meeting with one of our eleven team members today! Wealth Managers has presented information in a fair and balanced manner.

2022 was a challenging year for investors. Markets fell into bear market territory and experienced the worst annual performance since 2008. The S&P 500 (Growth / Growth & Income), Russell 2000 (Aggressive Growth) and Nasdaq (Growth) declined 19.4%, 21.6% and 33.1%, respectively, last year. Interest rates swung wildly, with the 10-year Treasury yield jumping from 1.51% at the start of the year to a high of 4.24%, before ending at 3.88%. This mirrored inflation as the Consumer Price Index climbed to a 40-year high of 9.1% in June. As a result, the Fed hiked rates seven consecutive times from 0% last March to 4.25% in December. Along the way, a myriad of other events impacted markets, from the war in Ukraine to China's zero-Covid policy, affecting everything from oil prices to the U.S. dollar. Probably the most event-driven year I can remember since 2008 and 2009. These market swings can cause whiplash for even the most experienced investors. Much of what drove markets last year was the result of the pandemic and its rapid recovery over the past three years. Like an earthquake that then causes a tsunami, the sudden drop and resurgence in business and consumer demand, fiscal and monetary stimulus, and global supply chain capacity created shock waves across the financial system. While they do cause immediate damage, even the largest shocks eventually settle. Despite these historical shifts in the economy and markets over the past year, the principles of long-term investing haven't changed. Dave Ramsey and our team still recommend Aesops Fable, "The Tortoise and the Hare," when mimicking your investment strategy. Have a plan (the seven baby steps) and stick with it. Proverbs 21:5 reminds us that having a plan and sticking with it, is Biblical and wise, "The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to want". Keeping one's footing as markets rock back and forth is still the best way to achieve financial goals. Below, we review five thoughts on what drove the markets from this past year that can help investors to maintain a proper long-term perspective in 2023. 1. The historic surge in interest rates impacted both stocks and bonds Beneath all of the headlines and day-to-day market noise, one key factor drove markets: the surge in interest rates broke their 40-year declining trend. Since the late 1980s, falling rates have helped to boost both stock and bond prices. Over the past year, the jump in inflation pushed nominal rates higher and forced the Fed to hike policy rates. This led to declines across asset classes at the same time. While this has created challenges for diversification, there is also reason for optimism. Most inflation measures are showing signs of easing, even if they are still elevated. This has allowed interest rates to settle back down in recent months even as the Fed continues to hike rates. While still highly uncertain, most economists expect inflation and rates to stabilize over the next year rather than repeat the patterns of 2022. 2. The Fed raised rates at a historically fast pace The Fed hiked rates across seven consecutive meetings in 2022 including four 75 basis point hikes in a row. At a range of 4.25% to 4.50%, the fed funds rate is now the highest since the housing bubble prior to 2008. In its communication, the Fed has remained committed to raising rates further and keeping them higher for longer in order to fight inflation. If you've watched my weekly What We Learned in the Markets This Week videos, you've heard me discuss the CME Groups FedWatch Tool. This gives us real-time probabilities of what the Fed will do to their rates. As of the writing of this article (January 31st, 2023) they currently predict the Fed will move rates up 0.50% tomorrow (97% probability) and an 81% probability they'll move them up 0.25% in March. Then the highest probabilities are them staying put until November 2023 when CME Group gives more of a chance of a rate cut than any additional increases. Much could happen in between tomorrow's meeting and year end, which is why you should subscribe to our weekly video's if you don't already. Last year when the markets felt like the Fed could start to ease on rates we started to rally, only to be disappointed. The market rallied from June to August and again in October and November when investors believed the Fed might begin loosening policy. When these hopes were dashed, markets promptly reversed, causing several back-and-forth swings during the year. These episodes show that good news supported by data can be priced in quickly but that investors should not get ahead of themselves. 3. Inflation reached 40-year highs but has improved While inflation has not been "transitory," it may still be "episodic." This is because the factors that drove these financial shocks were, for the most part, one-time events. Many of these are already fading as supply chains have improved, energy prices have fallen, and rents have eased. Still, the labor market remains extremely tight and wage pressures could fuel prices that remain higher for longer. At this point, the direction of inflation may matter to markets more than the level. Investors have been eager to see signs of improvement across both headline and core inflation measures, and good news has been priced in rapidly. There are reasons to expect better inflation numbers over the course of 2023. 4. The rallies in tech, growth and pandemic-era stocks have reversed The past year also experienced a reversal of the rallies in 2020 and 2021 that were concentrated in the tech sector, Growth style, and pandemic-era stocks. For the first time in years, Growth & Income Stocks outperformed Growth as former high-flying parts of the market crashed back to Earth as the economy slowed and interest rates jumped. As you know, at Whitaker-Myers Wealth Managers we believe in a diversified approach to investing, just as the team at Ramsey Solutions recommends. This includes different size categories (large companies like those funds in growth and growth & income funds and smaller companies like those found in aggressive growth funds), styles (Growth & Income and Growth), geographies (U.S. vs. International), sectors, and more. It's also a reminder that rallies can extend for long periods, during which investors experience FOMO and pile in with little thought to risk management. Staying disciplined during these periods, which occur periodically, is important to achieving long-term success. Last year, a client called the Ramsey Show to shout out his Financial Advisor, Jake Buckwalter. Jake, just as you would expect an Advisor with the heart of a teacher to do, spelled out very clearly that there are times when International investments outperform US-based investments. The client appreciated this thorough education because he, in his mind, couldn't justify investing in the international market because of its recent underperformance to US stocks. Well, guess what we've seen through the first month of 2023? International stocks are up 7.66%, while the S&P is up a cool 6.18%. 5. History shows that bear markets eventually recover when it's least expected While 2022 was challenging, history shows that markets can turn around when investors least expect it. While it can take two years for the average bear market to fully recover, it's difficult if not impossible to predict when the inflection point will occur. Last year I wrote an article called Bear Markets - Normal Not Fun, where I spell out how long each bear market has taken to recover. Many investors have wished that they could go back to mid-2020 or 2008 and jumped back into the market. If research and history tell us anything, it's that it's better and easier to simply stay invested than to try to time the market. This could be true again in 2023, just as it was during previous bear market cycles. The bottom line? While the past year was difficult, those investors who can stay disciplined, diversified and focused on the long run will be on a better path to achieving their financial goals in 2023 and beyond.

Defining the Debt Ceiling With the debt ceiling coming up, I decided it would be a good time to revisit this subject since it pops up from time to time, steals all the headlines for a number of days/weeks/months, and then disappears just as fast. The debt ceiling is the legal limit on the total amount of federal debt that the government can accrue. The limit applies to the federal debt held by the public, mainly comprised of treasury bills and notes, which corporations, local and state governments, banks, and foreign entities can hold. The limit also applies to money the government owes itself from borrowing from accounts like Social Security and Medicare trusts. How high is the debt ceiling? This amount currently sits at….. $31.381 Trillion. $24.5 Trillion is held publicly, and $6.9 Trillion is government borrowing. While the government hit the debt ceiling on January 19th, the Secretary of the Treasury, Janet Yellen, sent a letter to congress and used “extraordinary measures” to keep the government from shutting down. The most notable of these extraordinary measures is the suspension of reinvestment of government securities in the G fund, which can be found in government employees’ Thrift Savings plan. After the debt ceiling impasse, the G fund will be made whole. I will let my G fund participants pass judgment on that action. What does it take to shut down? 2018 was the last time there was an extended government shutdown when the government was shut down for 35 days. The point of contention was the funding for Trump’s border wall. Trump wanted $5.7 billion for border wall construction, but congress did not, and after pushback from the press and a change of leadership in the house from republican to democrat, the funding package went through without Trump’s wall funding. As with many things in the media, the spin is often in the name. The “Government Shutdown” doesn’t mean that every government employee stops showing up without pay. A government shutdown furloughs nonessential government employees while keeping essential parts of the government open and functional. When a funding bill is passed, the government employees receive backpay and resume regular operation. However, I have sympathy for government employees, the negotiation piece that congress uses to push its agenda. Benefits of Living the “Ramsey way” The larger question should be, how have we gotten to a point where we must borrow from the Social Security fund and the G fund to meet our government obligations? I’ll be honest; the government needs to take a trip down to Nashville, stop in the PODS Moving & Storage studio, and take the verbal beating that Dave Ramsey so lovingly hands out to his callers. He is speaking the truth in love. If you feel like the government, with spending out of control and liabilities coming due, reach out to us then we can start to formulate a plan. The government’s benefit is that they have no retirement date, so in theory, it can indefinitely continue to service the debt as a line item on its budget. If you dream of retiring one day, you don’t have this luxury. Schedule a meeting with a financial advisor or financial coach today!

Investing in a 529 There were many changes to investing laws in the omnibus spending bill passed on December 29, 2022, that included the Secure Act 2.0. One of the most significant changes to educational investment accounts was passed for 529 accounts. Starting in 2024, account holders who have had a 529 with leftover or unused funds can roll over funds from their 529 to a Roth IRA. Qualifications and Considerations If you’re asking yourself if this is something to pursue when investing in a 529 for your children, below outlines the areas to review to help you feel more confident. The account must be set up for at least 15 years before you can utilize this feature. If you’re looking at setting up an account for your kids and you don’t do it until ten years old or later, the child will not be able to take advantage of this until their mid-to-late 20s. It has not been determined if you change the beneficiary of the 529 if that resets the 15-year clock. There is a lifetime cap of $35,000 per person/account owner. So intentionally overfunding a 529 is limited. If there are leftover funds after overfunding, you can always transfer the account to another family member. The 529 beneficiary must have earned income to be eligible to roll over funds from a 529 to a Roth IRA. This is one of several qualifications needing to be clarified in the bill. Rollovers are subject to the annual Roth IRA contribution limits (less if you’ve made direct contributions). Example: You made a $1,000 contribution in 2024. The Roth IRA maximum is $6,500; you would only be able to roll over $5,500, given that you meet the other qualifications. You cannot transfer contributions and earnings made in the last five years. There are no income limits on completing the rollover like there are for Roth IRA contributions. Choosing the right school School choice matters even if you have the funds to cover the total cost of education. Rather than choosing a public school at $25,000 per year for a 4-year undergraduate degree and having to come out of pocket an additional $40,000, a family could consider community college. If community college costs $10,000 annually for four years and you have $60,000 in your 529, you could roll over the remaining $20,000 every year until exhausted into the beneficiary’s IRA. This can put even more importance on the school choice for parents and their children. Whether this is something you should take advantage of depends on your personal situation. If you are looking for guidance around education planning and saving for yourself or your children, set up a meeting today with your Whitaker-Myers advisor to help you achieve your financial goals and objectives.

What is a “Holistic Plan?” It’s not uncommon to hear the term “holistic plan” in the financial planning and services industry. Most companies hold themselves out as experts in creating a “unique plan” for their clients while providing little to no insight into how the desired outcome will ultimately be achieved. This article will outline some things to look for and share why Whitaker-Myers Wealth Managers is a good fit for you. Age and Risk Tolerance What you do with your money today, in many ways, will impact what your life looks like in retirement. We all want the peace of mind that we will have what we need in retirement while simultaneously avoiding the alternative. When you sit down with an advisor, age and risk tolerance are often among the first questions asked. Still, it’s important to consider much more to develop an investment strategy that fits your specific needs. Let’s illustrate it this way: If you are young, with a long-time horizon, it can be said that you want a penthouse view of the ocean. When storms roll in, you’re okay with the risk because the sunrises and crystal-clear days make it worth the price of admission. When you’re in retirement, you want the safety of fixed income, much like the safety of a first-floor beach access unit, with a quick escape if the entire building catches on fire. This illustration can help delineate between equity and fixed-income investing, but it is by no means exhaustive. Simply put, each investor brings more to the table than just their age and risk tolerance. But What Else? There is no doubt that equity and fixed-income investing should be a part of all portfolios at one time or another. Determining specific allocations into each category depends on age and risk tolerance, but many more things must be considered. Alternative investments have a place in certain portfolios. However, the reality is that only some advisory firms have access to and an understanding of how certain alternatives fit into the portfolio mix. Dave Ramsey often talks about the positives of mutual fund investing. He also discusses the benefits of real estate investing, creating a nicely diversified portfolio, and an appropriate portion of investments that aren’t correlated to the stock market. There are alternatives to fixed-income investing that can be right for specific clients, again punctuating the importance of looking critically at each client’s entire portfolio and financial plan. Investing and financial planning are complex topics that deserve time and attention for your sake. At Whitaker-Myers Wealth Managers, we are serious about thinking critically for our clients, giving them options, and ensuring, with the heart of a teacher, that they understand what we’re doing with their investments and why. If you are looking for an advisor or have questions about investing, reach out to our team today.

Follow the Baby Steps in order, and stick with them! It is great when Dave Ramsey shares an exciting social media post about investing $100 a month for 40 years and having over $1,000,000 at the end. I see those posts, and they have some of the highest traffic of replies, likes, and so on, which indicates to me that many people want to follow Dave’s program and really take control of their money. Unfortunately, most people have so much debt, bills, and other expenses that when everything gets divvied out each month, there is barely enough left to buy a pack of gum, or worse! Barely staying afloat, drowning in debt, and losing sleep at night, wondering how to pay the next bill is an awful feeling; I’ve been there, and so have several of my colleagues. That is a significant reason why Whitaker-Myers Wealth Managers was started in the first place. We know what it is like to be sick and tired of being sick and tired, and we love helping people achieve their financial goals through good planning and investments, but we also want to help relieve people from the burden of being slaves to the lender. I am a firm believer and follower of Dave’s 7 Baby Steps, and if you are seeing one of those posts and wondering where you will find $100 leftover in your budget, start here and go in order. Step 1: Save $1,000 as a Starter Emergency Fund This is the beginning of the journey, the first test of your financial fortitude. Your goal in step one is to save $1,000 as fast as possible in a bank savings account. Why as fast as you can? This builds the foundations of being disciplined and intentional with your money which is crucial to find success in steps 2-6. It also provides a small safety net for life’s little whoopsies that will come along. Step 2: Pay Off All Debt (Except the Mortgage) In step two, you want to take all your debts minus the mortgage, put them in order from the smallest to the largest dollar amount, and start knocking them out one by one in that order, regardless of the interest rate. Dave calls this the Debt Snowball Method. I personally used this years ago when I found Dave, and it changed my life. Keep in mind that making minimum payments in this step will not get you to your goal. Sacrifices will be made to beat Baby Step 2. One of Dave’s favorite moments on his show is when he brings people to the stage to do their “Debt Free Scream.” He asks how much they paid off and how fast and sometimes calls them “weird people,” but it is a term of endearment. Being weird is to be hyper-focused or, like Dave says, “gazelle intense” on becoming debt free. Giving up date nights, babysitters, gourmet foods, and streaming services are just some examples of how to focus on your debt-free goal. Step 3: Build a 3-6 Month Emergency Fund After you have been gazelle intense on paying off your consumer debt, you now have plenty of freed-up cash to build a fully funded emergency fund with 3-6 months of living expenses. A common question asked, “Should my emergency fund be three months or six months?” The answer is … it depends. If you are a one-income family, you are self-employed, work on straight commission, or have someone in the family that requires frequent medical needs; then a 6-month emergency fund is better for you. If you are a two-income family or have had a steady job for a long time, then a 3-month emergency fund would be fine. Another important note with the emergency fund is that it should not be commingled with your other checking or savings accounts. One option is to put your emergency fund into a money market savings account where you could earn much better interest than a regular savings account at a bank. Reach out to one of our other advisors or me if you want to know more about that. The difficulty of getting to step three should also have instilled some very strong positive habits about being intentional with your money. This is precisely why you should do the steps in order and not jump around or try to do them all at once. Being financially responsible, just like anything else we excel at in our lives, requires discipline, practice, and effort. Step 4: Save 15% of Your Income Toward Your Retirement Welcome to step four. All those social media posts about becoming a millionaire are right in front of you. This is also where I and our other Smartvestor Pros at Whitaker-Myers come in to help through the rest of the steps. We will help you build a comprehensive financial plan and manage your investment portfolio to help you achieve your goals and keep you on track to retirement and beyond. A good rule is to save at least 15% of your GROSS household income toward your retirement. If you have a 401(k) or another employer-sponsored plan that offers a match, start there and save up to the match. That’s free money, baby. Next, you will want to set up a Roth IRA and start saving there. Roth IRAs are great because you put money in that has already been taxed, it grows tax-free, you get tax-free distributions after age 59.5, and there are no required minimum distributions at age 72. It would be wise to speak to a financial professional at Whitaker-Myers before attempting this on your own. Step 5: Save for Your Children’s Education This step may not apply to everyone, but if you have kids and want them to go to college without student loans, you should start saving as soon as they are born. Every state has at least one 529 plan available that offers tax-free savings on qualified education expenses. Those are pretty good, but if there is doubt, it may be wise to open a UTMA account or even a taxable brokerage account earmarked for education. Your advisor can help you determine how much you need to save and provide investment advice regarding education planning. Step 6: Pay Off Your Mortgage At step six, you should have this whole gazelle intensity down to a science. Making extra payments on your mortgage can potentially save you tens of thousands of dollars of interest payments. For additional motivation, use a loan amortization schedule to figure out exactly how much you will save by paying off your mortgage early. Step 7: Build Wealth and Give I like to say, “The best part about making money is being able to give it away.” I also appreciate Dave’s rationale that one does not reach true financial peace until they are able to give back. Giving should be an essential part of everyone’s life. Many strategies can be implemented to achieve this and continue to grow and protect the assets you have worked hard to save your whole life. We can help build and manage a portfolio to maximize your giving while minimizing your taxes. The steps are designed to help you be intentional with your money and build good habits, but many people need a little extra push to get started, and that is where a financial coach can step in and help. At Whitaker-Myers, we have a financial coach on staff specializing in Baby Steps 1-3 to help you tackle debt, learn budgeting techniques, and help you save for your emergency funds; contact her today if you need help in these areas. If you are in Baby Steps 4-7 and looking for advice, please contact me, Kelly Kranstuber, or any of our other advisors here at Whitaker-Myers Wealth Managers.

The Smartphone Advantage It is no secret that we hold the most known information ever discovered in the palm of our hand through the innovations of iPhones, Androids, and simply the internet. Because these devices hold so much information and have so many excellent tools at our disposal, it would be a crime not to incorporate them into one's daily life. From Google, to all the apps available to those with our smartphones, being financially savvy has never been as easy as it is now. Here are a few tips we suggest to be financially responsible with the help of your phone. Look at your bank account daily Something that I encourage most people to do is to check their bank accounts daily. People often prefer to avoid accepting the reality of how much something dented their bank account, such as shoes, amazon, or even rent! My bank has an app, so it is all very easy to look at for real-time balances. Seeing how each transaction affects that number is crucial to budgeting your life and saving for the future. It is also important to project out future expenses as you have money coming in. Every two weeks for me are major payments due: Miscellaneous expenses from the month and rent. I know roughly how much each will cost, which lets me know what is left over. Knowing your "leftover" number is also very important, as it can give you an idea of what you want to contribute for retirement each month and what will be used to spend/save up for fun things like vacations or nice clothes. Track your spending through apps As previously mentioned, one of my major expenses comes from my miscellaneous expenses from the month. Through apps like Mint, one can track spending habits. Maybe you bought $400 in clothes for the month, and you had no idea. Or even $500 this month on gasoline alone. Using applications designed to help someone comprehend how much they are spending each month and what they are spending it on can help them manage their financial life for the better. We also suggest that everyone downloads the EveryDollar app. This is the budgeting system the Ramsey Solutions team created to make budgeting effortless and, of course, in the palm of your hand. It is a zero-based budget, meaning it tells you how to spend every dollar in your monthly income to keep you in line with the parameters you set for yourself and to help you track your transactions, so you know you don’t go over what you have in the bank account. You can set goals for savings, paying off your debt (baby step 2), and even link it to your bank account with the premium membership, so you have in-the-moment numbers. Set it and forget it- Automatic Investing Lastly, one can track their investments with their advisor through apps like Fidelity, Vanguard, or Charles Schwab. Whatever one may contribute to these accounts from their "Leftovers" can be easily tracked through these apps on their phone. Often people want to call their advisor and ask how their account is doing or how to track their contributions, etc., which is wonderful. But with the help of your advisor walking you through what you see on the app, you can fully understand the complete picture of your account to view at any time you would like. Using smartphones to our benefit Use these apps on your phone to your benefit. They are designed to help people overwhelmed by the intricacies of the financial world. They are more powerful than we can comprehend, so use them to see how they can help you stay more financially stable. We encourage you to start taking full advantage of these wonderful tools provided by our phones. The power of speaking with your advisor As overwhelming as the stock market, timing, capital losses, and more can become, always feel free to use an advisor you know to ask questions. It is our passion to help people understand these topics. When it comes to the life work of our clients and prospects, no decision is ever taken lightly. No account value is disregarded because all concerns and questions hold such a heavy weight in a time like this. We hope you've learned a great deal from this article and, more importantly, reduced some stress from your life today. Please feel free to use Drew Hodgson to begin asking your questions. There is no too small of a question and no wasted time if you choose to speak with him.

Is it really worth it? $6.75 That is the price I paid for one medium, flavored, double caf coffee last Friday. At the moment, I justified the 7:45 am, 20 minutes in line for the drive-through order. Considering I was on my way back from picking up my computer cord I left at the office with a dying computer at home, my 2-year-old had been up since 3:00 am with a cough and just wanting to be held, and my 4-month-old woke up with goopy, crusty eyes; in my tired mama’s eyes, it was better than going back home, unloading them both, and trying to make a cup of coffee before plunging into the day’s work. But as the (way too cheerful for 7:45 am) barista handed me the coffee, I found myself asking myself, was the convenience of this over-priced coffee actually worth it for that price? Buyer’s Remorse And even though it was technically a guilt-free pleasure because I used a gift card I got from Christmas, I still had buyer’s remorse after pulling out of the now even more crowded parking lot. I kept thinking how at the moment, I was tired and felt like it was warranted. And, yes, I know I was not being frivolous since I had the “cash” from the gift card, but I kept thinking of how if I didn’t, would I still have bought it? Would my tired eyes and arms still lead me through the drive-through line? Is a treat now really a treat in the end? A moment on your lips, forever on your hips Or, in this case, “A moment on your lips, forever out of your bank account.” Again, I realize I had the gift card, so I wasn’t really taking from my budget, but what if I had? Would I have indulged in the convenient coffee had it taken away from my diaper budget? (Because hello, two under two in diapers; let’s just go ahead and start a sinking fund for that now, please) Or, at the price of eggs, did I trade a warm cup of joe for two dozen eggs out of this week's grocery budget line? Can instant gratification lead to instant regret? I know that with coaching, I discuss with clients the importance of setting parameters around their budget items and stress the importance of monitoring their expenses to help regulate their behaviors. But with the world that we live in now, with more convenience due to our fast-paced society, and can literally at the click of a button have what we desire, monitoring your behavior is more challenging than ever. But here’s the lesson… However, despite all the mom guilt I was throwing at myself, I realized something. I had changed my behavior. I have re-wired my brain over the years. And I don’t mean only before kids, but before I started budgeting for myself. Before learning to budget, I wouldn’t have thought twice about ordering that coffee. And even though I had a gift card to pay for the coffee that day, the fact stands that I took a second to pause and think about how, if I had not had the gift card, how that coffee trip would have impacted my budget. I have made the lifestyle changes I talk about with my clients. I know I talk about changing these behaviors and learning these new habits, but it was refreshing to have an “ah-ha moment” and a reminder for myself. So, was it really worth it? $6.75 for a cup of coffee. Here are my thoughts on it: For starters, it brought me a little bit of sanity to an already chaotic morning (remember, have grace on yourself). And the fact that I was using “free money” by paying for it with a gift card, vs. taking it out of my budget, allowed me to have the convenience coffee guilt-free (well, almost). And it was a great reminder to take a step back and see how I had come along these last few years in modifying my behavior. And not to say that I modified it in a way that says I could never have such a treat ever again, but I modified it in a way that I took a second thought on if that was the best way to spend my money. Today I am going to say it was worth it. If you want to learn ways to budget and learn lifestyle changes to help you save, set up a meeting with our financial coach.

Happy New Year!! You did it! You survived the gauntlet of Holidays that end each calendar year. With the new year comes new opportunities and new changes - some good and some bad; and with so much on your mind and in the business of life at the end of the year (traveling to friends and family, buying gifts, making meals, playing games and watching college football), it is easy to get caught up in bad habits and forget to finish the year strong. Getting Out of Bad Habits If you’re like me, no matter how well I plan, the end of the year always tempts me to jump back into bad habits - like spending more than I make or eating too much food, etc. I’ve heard all the excuses… “Everybody’s doing it!” “But I have to buy presents for my ex-wife’s second cousin’s stepson.” “I want my kid to have the best Christmas ever.” “I just HAVE to have it!” Bad habits create a hectic lifestyle, and that’s not how you want to begin a new year. For instance, if you spent more than you made over the holidays, you start the new year off having to get out of debt. The Bible clearly states that the borrower is a slave to the lender (Proverbs 22:7). I’m not saying you can’t have fun, but what are the consequences of your actions? How will you pay off that debt? Do you have to pause your contributions to your 401(k) or Roth IRA? If so, this has a compounding effect on your retirement. And for what? So, you could “keep up with the Jones’s?” Playing Catchup There is hope! This is a new year, and with the new year comes new goals and resolutions. Did you know you have until Tax Day of 2023 to max out your IRA or Roth IRA for 2022? That’s right! If you contributed $3,000 through December 31, 2022, and you want to continue to take advantage of 2022, keep plugging away with those contributions! Just make sure your contributions are coded for the correct year. The maximum contribution limit for IRAs and Roth IRAs in 2022 was $6,000 ($7,000 if 50 or older), so as long as you don’t contribute more than the contribution limit, you can keep contributing towards the 2022 year until Tax Day of 2023. Things to think about for 2023 IRA/ Roth IRA Contribution limit - $6,500 ($7,500 if 50 or older). If you plan to max out your 2023 contributions, here is the simple update you need to do based on how you contribute: Update your monthly contribution to $541.66 ($625 if 50 or older) Update your twice/month contribution to $270.83 ($312.50 if 50 or older) Update your biweekly contribution to $250 ($288.46 if 50 or older) Update your weekly contribution to $125 ($144.23 if 50 or older) 401(k), 403(b), Thrift Savings Plan, and most 457 Contribution limit - $22,500 ($30,000 if 50 or older) Click HERE to see the highlight of changes for 2023 Now What?! Luckily for you, we’ve got the answer that works every time. If you’re a Dave Ramsey follower, you’ve heard him harp on 7 action steps that will guarantee you financial success in life: the 7 Baby Steps. No matter where you are financially, these 7 steps will help you get out of debt, build wealth, and “live and give like nobody else.” If you would like help on your financial journey, reach out to your Local & National SmartVestor Pro and schedule a meeting. We are happy to meet you where you are and answer any questions you may have.

With 2023 off to a furious start, we may not soon forget the woes of 2022. In addition to a bear market, those woes include higher-than-normal interest rates that will linger into the new year. In this article, we will look at three (there are more) key ways interest rates impact your budget. Mortgage As fans of Dave Ramsey, we subscribe to the notion that debt is not a good idea. A mortgage can be a good wealth-building tool, but it’s best not to get in over your head. We advise our clients to secure a 15-year mortgage loan that has a fixed interest rate. This ensures that you are not locked into a 30-year agreement and that you’re not subject to the volatility of the current interest rate environment. Budgeting is easier when you know what you’ll be paying. The mistake that some people make is going with an adjustable-rate mortgage, thinking that they could potentially see a decreased rate in time. The reality is that adjustable-rate mortgages are bad; they could leave your mortgage payment subject to a sharp increase when the annual adjustment hits. If you’re considering buying a home, don’t let the interest rate environment hurt you – go with the 15-year fixed-rate mortgage once you’ve paid off all your other debt. Student Loans It is likely that if you have student loan debt, you have been paying a fixed rate since taking the loan initially. That hasn’t changed and won’t change due to the interest rate environment. Like a home loan, the Fed’s policy can’t touch fixed rates, but it will impact loans of future debt. If you’re planning on sending your kids to college, it’s best to start saving for the expense now and pay with cash when the time comes. You can open a 529 plan specifically for education expenses and we were recently granted some flexibility via the Secure Act 2.0, which states that unused 529 funds can be rolled into a retirement account penalty-free. If there weren’t already enough reasons not to lean on loans to pay for school, now you’ve got one more. Car Loans A car is pretty much a necessity these days unless you live in Manhattan. But buying a car on credit that’s worth more than your salary is not. The temptation is real, but the negatives far outweigh the positives when it comes to interest rates. Though car loans are most likely fixed-rate loans as well, any new car loan in this environment is going to bleed you dry. Cars are notoriously bad investments, so why buy a new one, especially on credit? A home goes up in value almost every time, whereas a car loses value the minute you drive it off the lot. Avoid paying interest altogether and buy an affordable used car, that gets you from point A to point B. Then, when you have your ducks in a row and feel the need for speed, buy a car that you really want with cash. A good rule of thumb to follow is this: If you don’t have the cash, you can’t afford it. In today’s instant gratification, mobile-pay environment this might seem like insanity, but in reality, buying something with someone else’s money is a lot crazier. That’s why Dave Ramsey always says, “Cash is king and debt is dumb…” Buying on credit is a craze that’s swept society, we get that. At Whitaker-Myers, we have a team of professionals who want to see you live a debt-free lifestyle and avoid the perils of borrowing your life away. If you struggle with budgeting and feel like you just aren’t making any progress, reach out to our financial coach, or talk to an advisor today. We’d love to help you live like no one else so that later on you can live and give like no one else.

Let me start out by saying if Dave Ramsey would do a solid for his country and run for President, we wouldn't be in this mess. With nearly $31 trillion in debt today, the plush cafeterias in Langley would be stocked with only rice and beans. Kevin McCarthy and Chuck Schumer would be required to hold weekly EveryDollar Budget meetings to ensure they weren't spending too much, and maybe most importantly, we'd have someone in the White House that is independently wealthy, thus not having to enrich themselves by using their governmental authority to "create wealth" for their family. Every Presidential cycle Dave is asked, and every time, he reminds us he'd have to be crazy to want to that job. The federal debt limit is once again in the news as the country rapidly approaches a critical deadline on June 1. Investors are understandably nervous about Washington failing to reach an agreement, a possibility that both sides agree would be a self-inflicted catastrophe. While it's unclear how this will play out in the coming weeks, the fortunate news is that financial markets are mostly taking these events in stride. How can investors maintain the right perspective around political and fiscal uncertainty? Federal borrowing reached the debt ceiling this past January First, it's important to understand what the debt limit is and is not. In simple terms, the federal government borrows money to pay its bills by issuing Treasury securities. This is necessary because the federal government often operates with a deficit whereby spending (on defense, Social Security, emergency pandemic stimulus, and more) exceeds government revenues (which consist primarily of tax revenues). While tax revenues increase as the economy grows (even without raising tax rates), they have been outpaced by spending over time. This borrowing adds to the national debt which hit the $31.4 trillion debt ceiling in January. Since then, the Treasury Department has been employing what it calls "extraordinary measures" to ensure that the country does not default on its obligations. The debt ceiling is a mechanism that requires Congress to approve additional borrowing above these levels. Thus, what makes this discussion confusing is that the debt ceiling is not about government spending per se. That spending has already been authorized through the normal budget process that takes place each year. Thus, the only question around the debt ceiling is whether the government can and should pay its bills. This is akin to signing the papers for a new car then afterwards requesting an increase to your credit limit. For most of us, the decision to buy something can't be separated from whether we will pay for it, even if it's with debt. Unfortunately, the Congressional process for approving a budget by September 30 each year is separate from whether the Treasury can actually pay the bills. Near-term Treasury rates have jumped but longer-term rates are steady Second, the large and ever-growing national debt is a controversial topic that impacts the economy and markets in complex ways. At the moment, Democrats, who control the White House and Senate, and Republicans, who control the House of Representatives, are in a standoff. On April 26, the House passed a debt limit bill by a narrow vote margin of 217 to 215. This would increase the debt limit through March 31, 2024 or until the national debt increases by another $1.5 trillion. However, it also includes provisions such as discretionary spending limits, the repeal of renewable energy tax credits, increased work requirements for benefits programs, and others. While many of these ideas are wonderful and common sense, they are politically fraught and thus unlikely to pass the Senate and be signed into law. As usual, there is plenty of political grandstanding around this issue with each side trying to gain the upper hand. Similar debt ceiling standoffs have occurred over the past decade with the limit suspended and raised in 2013, 2014, 2015, 2017, 2018, 2019 and 2021. According to the Congressional Research Service, the debt ceiling has been raised 102 times since World War II. Fortunately, despite the headlines and investor concerns, these episodes had little long-term impact on markets. The U.S. has never defaulted on its debt, and nearly all economists and policymakers agree that doing so would lead to turmoil in the financial markets and increase borrowing costs for businesses and everyday citizens. This risk is evident in the bond market with a sharp jump in Treasury rates with maturities around the debt ceiling deadline, and much lower rates thereafter. The one exception to markets staying relatively calm occurred in 2011 when a similar standoff led Standard & Poor's, a credit rating agency, to downgrade the U.S. debt. The stock market fell into correction territory, with the S&P 500 declining 19%. Ironically, the prices on Treasury securities increased during the 2011 debt ceiling crisis because, even though these were the exact securities being downgraded, investors still believed they were the safest in the world at a time of heightened uncertainty. The debt ceiling was eventually raised and a new budget was approved, allowing markets to bounce back. Income tax rates are still low by historical standards Third, debt ceiling aside, the national debt at today's level means that it has more than doubled over the past decade and, with very few exceptions, has grown nearly every year over the past century. While everyone generally agrees that the government should not spend more than it generates in tax revenues, the unfortunate reality is that neither party has addressed the problem over the past decade. The last balanced budgets occurred during the Clinton years and the Nixon administration before that. So, deficits are unlikely to go away. Given how heated the topic of government spending can be, it's important for investors to distinguish between their political feelings and how they manage their portfolios. In other words, investors should focus on what they can control in order to differentiate how things work from how they would like them to be. One factor beyond the market and economic effects is that the odds of higher tax rates may increase as the national debt worsens. Today, the highest income tax rates are slightly above their lows after the Reagan tax cuts, but still far below historical peaks. High-earners in the mid-1940s paid rates as high as 94% on their marginal incomes. Even those in the lowest bracket would have paid 20% or more during the 1940s, 50s, and 60s - double today's rates. U.S. corporate tax rates were also among the highest in the world until the 2017 tax cuts. So, while higher tax rates are not guaranteed, engaging in a financial plan that takes advantage of relatively lower rates today can help to protect investors from future tax uncertainty. The point here.... fund your Roth IRA while income tax rates are at lifetime lows for many of us. Dave Ramsey and Rachel Cruze talked about the debt ceiling news cycle last week on the show. You can listen to that conversation here. Dave's reaction was simple yet profound. "Yawn" is how he feels about the debt ceiling showdown. In his 62 years, this happened (as discussed above) many, many times, and even a few times we passed the debt ceiling deadline without a deal, and federal workers were sent home without pay for a few weeks until the politicians were done posturing. His advice is consistent as always, and on point with the team at Whitaker-Myers Wealth Managers, invest in the four categories of mutual funds and use funds that have had a very long track records (at least ten years). Simple, yet profound. The bottom line? The debt ceiling and federal debt must be resolved in the coming weeks. As with many political issues, it's important for investors to separate their concerns and not react with their hard-earned savings and investments. History shows that staying invested is the best approach to navigating drama in Washington.