For retirees and those approaching retirement age, there is no goal more important than ensuring their savings will support a long retirement. This challenge has been compounded by inflation over the past several years, which has eroded the purchasing power of cash savings. Today, prices remain elevated for the key spending areas affecting retirees the most, including healthcare, housing, and everyday necessities.
As many asset classes have reached new peaks, gold has also climbed over 60% this year to above $4,300 per ounce. This rally has captured headlines and prompted many investors to wonder if it is different from past episodes.
The market recently experienced its largest one-day decline since April, driven by escalating tensions between the U.S. and China over rare earth metals and tariff threats. While the brief selloff rattled some investors, markets quickly improved following softer language from the White House around trade. For long-term investors, these swings may feel like déjà vu after a period of relative market calm.
For long-term investors, a growing challenge today is how to manage cash as short-term interest rates fall. What appears safe actually comes with real costs beneath the surface, since holding too much cash can quietly undermine long-term financial goals. This comes at an important time, when some investors find themselves with “cash on the sidelines,” including a record $7.3 trillion held in money market funds.
The famous investing principle "don't fight the Fed" was coined in the 1970s but has only grown in significance. The idea is simple: the Federal Reserve's monetary policy decisions can have important effects on markets and the economy, so investors should consider them carefully. At the same time, perspective is needed to focus on the overall path of interest rates, and not individual Fed decisions. This is relevant today as the Fed continues its rate-cutting cycle amid a complex economic environment.
For retirees and those approaching retirement age, there is no goal more important than ensuring their savings will support a long retirement. This challenge has been compounded by inflation over the past several years, which has eroded the purchasing power of cash savings. Today, prices remain elevated for the key spending areas affecting retirees the most, including healthcare, housing, and everyday necessities.
The market recently experienced its largest one-day decline since April, driven by escalating tensions between the U.S. and China over rare earth metals and tariff threats. While the brief selloff rattled some investors, markets quickly improved following softer language from the White House around trade. For long-term investors, these swings may feel like déjà vu after a period of relative market calm.
For long-term investors, a growing challenge today is how to manage cash as short-term interest rates fall. What appears safe actually comes with real costs beneath the surface, since holding too much cash can quietly undermine long-term financial goals. This comes at an important time, when some investors find themselves with “cash on the sidelines,” including a record $7.3 trillion held in money market funds.
Investors experience market swings as a normal part of investing, and this year has been no exception. While market declines - such as the tariff-driven sell-off - can be uncomfortable, they also create opportunities to invest at more attractive valuations. On the other hand, when markets recover and climb to record levels, some investors may feel uneasy even if the underlying fundamentals are still strong. In both scenarios, holding portfolios that can weather all phases of the market cycle, with an eye toward long-term financial goals, becomes even more important.
Rainer Wealth Management
390 Diablo Road, Suite 202 | Danville, Ca 94526 | (925) 217-4280
