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Resolutions, a new calendar, predictions......

Whelan Financial Planning - Friday, January 01, 2016

I confess to being one of the masses hoping that the turning of a page on a calendar will inspire me to adopt a new habits and behaviors that will result a healthier body, a more organized everything, a frequently updated blog, and ultimately – a happier existence. 

The odds are against me.  According this Forbes article, only 8% of people achieve their New Year’s resolutions. The article also gives some advice on how to increase your chances of success, for example, set specific goals and measure your progress.

I find another New Year’s ritual somewhat entertaining – predictions of “market” performance.  I took a look back for online articles that predicted what would happen in 2015.  There was a general consensus that:

  1. The value of the S&P 500 would increase by roughly 7%, to close at about 2,200 on December 31, 2015.  It closed at 2,043.94 yesterday, a decline of approximately 1%.
  2. The Federal Reserve Bank would raise the short term Fed Funds rate in the latter half of 2015.  This did happen – the Fed Funds rate was increased to 0.25% from 0.00%.  It was a much smaller increase than predicted by most and it happened in the latter half of December.
  3. Oil prices – wow – just wow.  Crude oil was trading at over $100/barrel in June 2014.  It closed 2014 at roughly $54/barrel, a drop of more than 46%.  For 2015, most prognosticators suggested a rebound to $70 to $80 per barrel.  Crude oil closed at $37.04 – another 30% drop compared to the end of 2014.

It’s remarkable that so much time, money and ink is devoted to predicting the future. 

I’m trying to come up with a theme, a phrase, something catchy, to resonate with you, my potential client.  The theme is “Come in from the noise”.  Predictions of market performance are noise. 

Managing your investments, in the context of your goals and tolerance for risk, is just one of the things that personal financial planning is all about.  I can help you tune out the noise and direct your energy and attention to the things that matter. 

In the meantime, I’ll be setting my specific goals for eating (keeping a food diary), exercise (walking to my office at least 3 times a week) and staying organized (got to think about this one) so that I can become one of the 8% that keeps their New Year’s resolutions.  I resolve to take it one day at a time and to never, ever give up.

May we all have a happy, healthy and abundant 2016.