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Author: Minich MacGregor Wealth Management

Weather Volatility

Q1 Market Recap

Written by Minich MacGregor Wealth Management on . Posted in Uncategorized.

“If you don’t like the weather, just wait a minute.” That’s a common refrain in many corners of the country. You can hear it near the Great Lakes, on the prairies and plains, and in the mountain west. But it probably originated in New England, where the weather can go from sunny to snowy and back again in a heartbeat. Especially in the spring.

It’s also a line we like to remember whenever we experience a turbulent quarter in the markets.

Volatility was really the only constant during the first three months of 2025. As a result, all three major indices finished down for the quarter. But it’s important to remember that “volatility” doesn’t just mean “down.” It means changing in a sharp and unpredictable manner. In Q1, the markets rarely went in the same direction for more than a couple days in a row. (If you don’t like the weather, just wait a minute.) They were in a continual state of flux, which in some ways is the hardest state for investors to deal with. The good news is that just how today’s performance doesn’t necessarily dictate tomorrow’s, how the markets did in Q1 doesn’t necessarily predict the same for Q2.

To understand where we are, it’s always helpful to understand where we’ve been. So, let’s do a quick recap of why markets performed the way they did in Q1. Then, we’d like to share why volatility is a feature, not a bug, of investing.

There were three main storylines for Q1: new developments in artificial intelligence, inflation, and most importantly, tariffs. Let’s start with:  

Artificial Intelligence. As you know, the last two years have brought some stunning advances to the field of AI. There are now dozens of AI-related products, many designed to help companies become more productive and efficient. The more productive and efficient a company is, the more valuable it is to shareholders. As a result, the recent bull market has largely been driven by money flowing into tech companies participating in the AI boom.

But in January, a Chinese company known as DeepSeek revealed a new AI model meant to rival well-known services like ChatGPT. Because the company claims to have developed its AI with far less money and computing power, many chipmakers and AI companies have seen their share prices fluctuate dramatically in recent weeks. (If you don’t like the weather, just wait a minute.) So, just as those same companies were responsible for much of the market’s rise, so too are they responsible for some of the market’s recent slides.

Many of these companies are also being affected by the second storyline:

Tariffs. Over the past two months, President Trump has repeatedly announced and then often suspended tariffs on China, Canada, Mexico, and other countries across the globe. As of this writing, a 20% blanket tariff on all Chinese goods has actually been enacted, along with a 25% tariff on steel and aluminum imports from any country. Certain products from Canada and Mexico have tariffs, too. Dozens of other tariffs, though, have been either dropped, delayed, or merely proposed.1

The situation seems to change on a weekly basis. (If you don’t like the weather, just wait a minute.) It’s this unpredictability, more than anything else, that has the markets spooked. You see, tariffs make it more expensive for companies to import the supplies they need to create their own products. (For example, a tariff on imported computer chips and semiconductors impacts many tech companies that depend on those things to power the technologies they create.) But when investors aren’t certain exactly which companies will be affected, or when, or by how much, it creates massive uncertainty. And uncertainty is nearly always the chief cause of market volatility.

Tariffs also play a role in the third and final storyline, because they have the potential to cause:

Inflation. While inflation isn’t quite the same storyline it was last year, it’s still in the background, affecting almost everything around it. That’s because, after falling to 2.4% in September, the inflation rate steadily crept back up to 3% in January.2 (It then ticked down to 2.8% in February.)

Why does this matter? Because as long as inflation remains “sticky,” the Federal Reserve is likely to keep interest rates elevated. Higher rates act like ankle weights on stock prices, and investors have been waiting for years to see them decline. When the markets move by a larger-than-normal amount in a single day, it’s often because investors are rethinking what they expect the Fed will do with interest rates.

So, these are some of the prime causes behind all the volatility we’ve been seeing. And because all three are interconnected, the uncertainty each one creates is compounded by the others.

Make no mistake, volatility can be frustrating. As frustrating as a spring snowstorm when you were hoping for sun. Despite this, volatility can also be a positive — because it creates opportunity.

Here’s an example of what we mean. You remember how we said the phrase “If you don’t like the weather, just wait a minute” probably originated in New England? While he didn’t use those exact words, the famous author Mark Twain once alluded to them in a famous speech he gave to the New England Society in 1876.3 Here are a few excerpts of what he said:

“Gentlemen: I reverently believe that the Maker who made us all makes everything in New England — but the weather. In the spring I have counted one hundred and thirty-six different kinds of weather inside of four and twenty hours. I could speak volumes about the inhuman perversity of the New England weather. There is only one thing certain about it: You are certain there is going to be plenty of weather.

But…there are at least one of two things about that weather which we residents would not like to part with. If we hadn’t our bewitching autumn foliage, we should still have to credit the weather with one feature which compensates for all its bullying vagaries: The ice storm. When a leafless tree is clothed with ice from the bottom to the top — ice that is as bright and clear as crystal; when every bough and twig is strung with ice beads, frozen dewdrops, and the whole tree sparkles cold and white like [a] diamond plume. Then the wind waves the branches, and the sun comes out and turns all those myriads of beads and drops to prisms that glow and burn and flash with all manner of colored fires. The tree becomes a spraying fountain, a very explosion of dazzling jewels, and it stands there, the supremist possibility in art or nature, of bewildering, intoxicating, intolerable magnificence!

Month after month I lay up my hate and grudge against the New England weather, but when the ice storm comes at last, I say: “There, I forgive you now. The books are square between us. You don’t owe me a cent. Your little faults and foibles count for nothing; you are the most enchanting weather in the world!”

In other words, all the frustrating unpredictability — or volatility — of the New England weather was worth it to Twain…because it gave him the sublime sight of a tree after an ice storm.

While it’s not so poetic, something similar is true about the markets. All the frustrating volatility is worth it to investors, because when the dust settles, it shows us which companies are truly strong. It’s that same volatility that gives us the opportunity to own those companies at lower prices. It’s that volatility that gives us the chance to be patient when others are restless. Without volatility, we wouldn’t have experienced the rallies that followed afterward.

Of course, if you ever have any questions or concerns about the markets, that’s what we’re here for. Please let us know if you would ever like to chat. But in the meantime, remember this: While no one can say when the current market conditions will change, we do know that they will. The storylines of tomorrow will be different than the ones of today.

Sometimes, all we have to do is just wait a minute.

1 “See all the tariffs Trump has enacted, threatened and canceled,” The Washington Post, March 27, 2025. https://www.washingtonpost.com/business/interactive/2025/trump-tariffs-enacted-effect-threatened/
2 “12-month percentage change, Consumer Price Index, selected categories,” U.S. Bureau of Labor Statistics, https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm
3 “Speech to the New England Society,” The Letters of Mark Twain, https://www.marktwainproject.org/letters/supplementary/mtdp00229/

Spring Cleaning Image

Financial Spring Cleaning

Written by Minich MacGregor Wealth Management on . Posted in Posts.

Spring is in the air, and that means it’s time for spring cleaning. But wait! Before you pick up that dustpan, give a thought to your financial spring cleaning first.

What do finances and spring cleaning have to do with each other? Well, if you have financial goals you’re planning for, the answer is “A lot!” These days, the term spring cleaning is often used as a metaphor for getting our daily affairs in order. As you can imagine, getting your financial affairs in order is critical if you intend to check off all the items on your personal bucket list. There are many things to keep track of. Many tasks that need doing; many decisions to make.

So how do you begin? Well, when many people do their actual spring cleaning, they make a checklist. What supplies they’ll need, what rooms need to be cleaned, what needs to be mopped, vacuumed, dusted, or organized… it’s the most efficient way to clean. We suggest doing the same for your finances. So, without further ado, here is a sample Spring Cleaning Checklist to help you stay organized and on track to your financial goals.

Financial Spring-Cleaning Checklist

[ ] Contribute the maximum amount to your IRA if you have one. Remember, an IRA is a valuable way to save for retirement in a simple, tax-advantaged way. For the 2024 tax year, the annual IRA contribution limit is $7,000 if you’re under 50, and $8,000 for those 50 and older.1

 [ ] Review your 401(k) and rebalance if necessary. How has your 401(k) been performing? Do you understand how your money is being invested, and why? Are you contributing enough to take advantage of any employer matching? Do the investments inside your 401(k) need to be rebalanced to match your original allocation?

[ ] Review your holdings. These days, many investors adopt a “set it and forget it” mentality with their investment portfolio(s). That’s certainly better than stressing over the markets daily, but it’s critical to review your holdings at least once or twice a year to make sure everything is in order. Is your allocation still where it should be? Is your portfolio still in line with your tolerance for risk? Are your holdings providing the kind of return you need to reach your financial goals? Do you understand everything you own and why? If the answer to any of these questions is “No” or “I don’t know,” then it’s time for us to sit down and take a closer look at things. And when we say, “review your holdings,” we mean all of them. That includes all institutions you do business with! (Many investors sometimes forget where all their assets are kept and thus fail to review them.)  

[ ] Review your cash flow and examine your expenses. Which are likely to continue for the long-term? What expenses can you remove right now? This is a good way to find extra ways to save for your goals, and it will make your life a lot simpler once retirement comes.

[ ] Decide now what to do with your tax refund. If you’re getting a tax refund this year, think about how you want to use it. Approximately 1/3rd of Americans use their refund to pay off debts; others stick it in a savings account.2 One underrated and oft-underused option: Invest it instead. It can help you catch up on saving for retirement, pay for a loved one’s college expenses, or enable you to achieve one of your long-term goals even sooner.

 
[ ] Make sure you know where all your estate planning documents are. You should have a copy of your will, power of attorney, advance medical directives, letter of instructions, and other documents in a secure but easily accessible place. Make sure your spouse (or other loved ones) knows where these documents are kept.

[ ] Review your current insurance policies. Are there any potential gaps? (For example, Disability and Long-Term Care insurance are two types of policies many people don’t have but are often extremely valuable for retirees.)

[ ] Check your credit reports. Credit reports aren’t just for getting loans. They’re also a handy early-warning system for fraud and identity theft. A good rule is to check your credit at least once per year. Be on the lookout for changes that don’t look familiar to you as well as “hard inquiries.” This is when a business checks your credit report because they received a new application for credit or services. These can impact your score and stay on your reports for up to two years. They can also be a red flag for thieves trying to use your information illicitly.

[ ] Reprioritize your goals. As you think about getting your finances in order, also think about the goals your finances are designed to help you achieve. Do you have new goals? If so, write them down. Are there older objectives that need more attention? If so, determine where they need to be placed on your schedule. By doing these things, you can ensure your finances are not only organized but getting you closer to the places — and person — you want to be.

Spring cleaning is never the most fun thing in the world, but it’s often one of the most beneficial. Just as you probably enjoy living in a clean, organized home, you’ll enjoy the peace of mind that comes with getting your finances in order. Trust us: if there’s one thing we’ve learned in all our years of helping people plan for their goals, it’s that a little organization today can make for a much happier tomorrow. In the meantime, we wish you a happy spring — and a happy spring cleaning!

1“IRA Contribution Limits,” IRS, https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits
2 “Over a third of Americans plan to spend their tax refund right away, mostly to pay bills,” CNBC, https://www.cnbc.com/2022/04/02/most-americans-plan-to-spend-tax-refund-on-essentials.html

Join Our Newletter

Written by Minich MacGregor Wealth Management on . Posted in Uncategorized.

We send out our newsletter email monthly. We encourage you to join our newsletter to ensure you never miss an edition.

Please, subscribe now if you’re not receiving our newsletter in your inbox.

The latest issue of our newsletter, The Retirement Road, is now available!

The March edition is about retirement planning issues that often go unnoticed. This issue covers the following topics:

  • Market recap for February 2025. 
  • Taking inflation into account
  • Company stock decisions
  • Liquidity considerations
Click to view and subscribe to our
most recent monthly newsletter!

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Tending a garden

Tariffs, Fear, and the Investor’s Dilemma: The Right Questions to Ask

Written by Minich MacGregor Wealth Management on . Posted in Posts.

The tariff-related questions that investors should be asking

“What should we do about tariffs?” It’s a question we’ve heard a lot lately, often with a note of fear in the voice of whoever is asking it. In this message, we want to answer that question. We also want to talk a little about fear, how we handle it…and how we can benefit from it.

If you’ve been following the financial news at all, you know that a feeling of anxiety has dominated the markets for the past month or so. But in the last few days, that anxiety has turned into fear. You see, on March 4, a 25% tariff on Canadian and Mexican imports went into effect.1 This requires U.S. companies that purchase goods from these countries to pay a 25% tax. At the same time, President Trump also imposed an additional 10% tariff on Chinese goods on top of the original 10% duty that began last month.1 As expected, all three countries have retaliated with their own tariffs on U.S. goods. That means the U.S. is now officially in a trade war.

The markets have not reacted to this news well. On March 4 alone, the Dow plunged over 600 points.2 The NASDAQ has been creeping closer to correction territory since late February.

When fear strikes, investors often start asking themselves the following questions:

Are the markets going into a correction?
Will the economy go into a recession?
Should I change my allocation?
Is it time to get out and move everything to cash?

You can probably hear them around the water cooler at work. You can see them online. They’re questions we frequently get from acquaintances of ours. But they are not the questions investors should be asking.

To be clear, tariffs — especially at these levels — are not a small thing. While they can be used to generate revenue or bring countries to the negotiating table, they also can increase business expenses and cut into corporate profits. When this happens, many companies will pass on these costs to regular people like you and me in the form of higher prices.

In other words, tariffs can be inflationary, at a time when we are still dealing with higher-than-normal inflation.

Investors know all this. What investors don’t know is how long these tariffs will last, how high they will go, or how big of an economic impact they will have. We don’t know whether they will trigger a major downturn in the markets. We can make reasonable assumptions and educated guesses, but we don’t know for sure. And that uncertainty, more than anything else, is why the markets have been so volatile lately. As the author H.P. Lovecraft once put it, “The oldest and strongest kind of fear is always the fear of the unknown.”

When fear grips the markets, many investors feel an intense urge to do something. After all, it seems so natural: When you know it might rain, you pack an umbrella. When you know you’ll have to drive in rush hour, you give yourself more time to reach your destination. As human beings, we always want to avoid the possibility of future pain. And since volatility can be painful, many investors start asking themselves: Should I change what I’m doing? Should I get out of the markets? The thinking is that if they can somehow avoid market turmoil, they can then get back in later when things are calm. Like skipping the freeway and taking service streets until you’re past the traffic jam.

But there’s a major problem with applying these metaphors to investing: They are short-term solutions for short-term problems. Investing, on the other hand, is for the long-term…and one of the biggest mistakes in investing is making a short-term decision that has long-term consequences. This is true in life as well. It’s why we pack an umbrella when it looks like rain, but we don’t move to another state. It’s why we may try to avoid driving when there’s heavy traffic, but we don’t sell our car.

That’s why a better metaphor for investing is planting a garden. With a garden, we don’t decide to uproot all our tomato plants and switch to squash after a month. We don’t put everything into pots because we hear distant thunder and know it might hail. We don’t overwater our plants just because we feel the need to constantly do something to help them grow. Instead, we choose the best possible soil. We plant with care. We water only when necessary. We harvest when things are ripe. And while we know the zucchinis might sometimes do better than the peppers, or the rosemary plant might fail, we always patiently give the seeds still in the ground all the time they need to sprout.

When volatility strikes, when fear and uncertainty dominate, we must always remember to treat our investments like a garden. Volatility, whatever the cause, is a short-term problem. Just as we want our garden to bear fruit for years, not months, it’s crucial that we make no short-term move that could harm our long-term plan.

Here’s how Peter Lynch, one of the most successful investors of all time, explains it: 

“A market calamity is different from a meteorological calamity. Since we’ve learned to take action to protect ourselves from snowstorms and hurricanes, it’s only natural that we would try to prepare ourselves for corrections. [But] far more money has been lost by investors preparing for corrections or trying to anticipate corrections than has been lost in corrections themselves. Skittish investors, fearing the correction is imminent, sell…their stocks and stock mutual funds. Or they put off buying stocks in companies they like and sit on their cash, waiting for the crash. But once the market reaches bottom, the cash sitters are likely to continue to sit on their cash. They’re waiting for further declines that never come, and they miss the rebound. They may still call themselves long-term investors, but they’re not. They’ve turned themselves into market timers, and unless their timing is very good, the market will run away from them.”3

For these reasons, here are the questions investors should be asking themselves:

  1. If I get out of the market now, how will I know when it’s time to get back in?
  2. Would I rather miss a correction that could last for a few months, or a rebound that could last for years?
  3. If I own investments I like, would I really want to sell them and risk buying them back at a higher price later?

To be clear, tariffs are an important story, and one that will quite possibly be with us for a long time. And market volatility is painful, make no mistake about that. But while we here at Minich MacGregor Wealth Management don’t welcome volatility, we don’t fear it, either. That’s because we know it’s an opportunity. An opportunity to be even more patient, even more disciplined, even more consistent than before. And it’s those qualities — patience, discipline, consistency — that make the most difference in the long run.

Blaise Pascal, the great mathematician and philosopher, once said, “All of humanity’s problems stem from man’s inability to sit quietly in a room alone.” We think there’s a lot of wisdom in that! So, while we will continue keeping a close eye on the markets — and while we will certainly send you more information in the future on tariffs and their effects — what matters most is this: We cannot do anything about tariffs, or how the markets react to them.

But we can do something about ourselves.

We can be gardeners.

So, as spring rolls in, as the flowers bloom and the trees begin to blossom, take this opportunity to focus on whatever garden you may grow at home. And know that as you do, our team is constantly tending the one you’ve entrusted us with. It’s a garden we intend to last a lifetime.

1 “Trump puts tariffs on thousands of goods from Canada and Mexico,” CNBC, https://www.nbcnews.com/politics/economics/trump-puts-tariffs-thousands-goods-canada-mexico-risking-higher-prices-rcna194542
2 “Dow tumbles again, loses more than 1,300 points in two days,” CNBC, https://www.cnbc.com/2025/03/03/stock-market-today-live-updates.html
3 “From the Archives: Fear of Crashing,” Worth.com, https://worth.com/from-the-archives-fear-of-crashing/

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Types of Stock

Questions You Were Afraid to Ask #16

Written by Minich MacGregor Wealth Management on . Posted in Posts.

The only bad question is the one left unasked. That’s the premise behind many of our posts. Each covers a different investment-related question that many people have but are afraid to ask.

In recent posts, we’ve been breaking down some of the more common bits of financial jargon that you are likely to hear in the media about the stock market.  In this message, let’s look at: 

Questions You Were Afraid to Ask #16:
What do terms like blue-chip, value, and growth stocks mean?

If you ever tune into the financial media, you’re likely to encounter terms for different types of stocks.  Blue-chip is a frequent one; so are value and growth.  But what do these terms mean? 

Terms like these are a kind of shorthand description of a stock’s size, history, or risk profile.   With a single word, experienced investors can learn a lot about a company’s size, potential, and risks.  And since every investor has different goals to consider when selecting their investments, some may choose to focus on one type of stock over another.   

Let’s break down each term so you know what they mean if you ever hear them mentioned. 

Blue-Chip Stocks. This term refers to stocks from large, financially stable companies with good reputations.  (The name comes from high-valued chips in poker, which are often blue in color.) 

Typically, these companies have a sizeable market capitalization. (As you may remember from my last “Questions” letter, this is the total market value of a company’s available shares of stock.)  Blue-chip stocks are often household names that everyone would recognize.  If you look at the credit card in your wallet, the soda in your fridge, or the labels in your medicine cabinet, you will likely see examples of blue-chip companies. 

Investors often prefer blue chip stocks for a variety of reasons.  First, because these companies are well-established, they are often seen as less volatile.  While not guaranteed, blue chip companies tend to last for decades and can often weather recessions. 

Another reason many investors like blue chip companies is because they often pay regular dividends.  A dividend is when a company pays a percentage of their profits to shareholders, usually on a quarterly basis.  These dividends can either be reinvested or used as a source of income. 

Value Stocks. Imagine there were two fine dining restaurants in your area.  One is famous— the kind of place that gets mentioned in travel guides and where people go to propose.  The other, located a few blocks away, is a tiny spot that hardly anyone knows about.  But it tastes just as good as the touristy place, and best of all, it’s so much cheaper.  So, you decide to go there more often than not, aiming to enjoy it for as long as you can before the word gets out. 

Value stocks are similar.  The term refers to companies that appear to be undervalued — meaning they are trading at a lower price than they’re potentially worth.  Investors looking for value usually focus on companies with experienced leadership, steady revenue, a strong competitive advantage, and a low share price relative to their earnings.

Value stocks aren’t always easy to find, and the very concept of “value” is a subjective one.  But the idea is to find companies that could give you great bang for your buck and the potential for long-term growth.  Because, like that neighborhood restaurant, once the word gets out and the stock gets more popular, it could rise significantly in price. Of course, the risk of a value stock is that it could stay “undervalued” for a long time.

Growth Stocks. This term refers to stocks that have the potential to skyrocket in price over time.  Often, growth stocks are younger companies seeking to set new trends or shake up an industry.  These companies focus on growing rapidly and reinvest their earnings entirely into expansion.  Since technology is constantly changing, many investors look to up-and-coming tech companies for growth stocks, hoping to score the “next” Apple or Microsoft. 

But with this potential for growth comes the potential for more volatility.  Growth companies are often much riskier than value or blue-chip stocks, because they are younger, unproven, and have less stable finances.  For every growth company that succeeds and matures, there may be a handful that fail and disappear.

As you can see, each of these types have their own pros and cons. Blue chips tend to be reliable, stable, and often pay dividends — but they can be expensive and their potential for growth may be limited.  Value stocks have the potential to grow, and are typically not as risky as growth stocks, but may be hard to find.  Growth stocks could have the highest upside, but also the most risk and volatility.  For these reasons, many investors often seek to diversify by holding all three types, depending on their specific needs and goals. 

In our next post, we will look at a few other terms you’ll often hear in the media: Dividends, buybacks, and stock splits.  Until next time! 

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Whitehouse image

Presidents’ Day and the Power of Unity

Written by Minich MacGregor Wealth Management on . Posted in Uncategorized.

On the morning of January 20, 1993, President George H.W. Bush sat down at his desk in the Oval Office for the last time. Since he had failed to win reelection to a second term, he was preparing to attend the inauguration of his successor, Bill Clinton. But before he left the White House, he decided to pen a note to the man who would shortly replace him.

When Clinton took office that afternoon, he found the note waiting for him.1 This is what it said:

Dear Bill,

When I walked into this office just now, I felt the same sense of wonder and respect that I felt four years ago. I know you will feel that, too.

I wish you great happiness here. I never felt the loneliness some Presidents have described.

There will be very tough times, made even more difficult by criticism you may not think is fair. I’m not a very good one to give advice; but just don’t let the critics discourage you or push you off course.

You will be our President when you read this note. I wish you well. I wish your family well.

Your success now is our country’s success. I am rooting hard for you.

Good luck —

George

We’ve been thinking about this letter as we approach Presidents’ Day. As you know, this holiday, which began as a way to celebrate the birthdays of Washington and Lincoln, has since become a celebration of all those who have served in our nation’s highest office.

We think it’s remarkable that Bush would take the time to write such a kind and thoughtful message to the man who had defeated him. He could very easily have said nothing. People would have understood. It also would have been easy to leave something nasty, sarcastic, or passive-aggressive. After all, Bush and Clinton were technically rivals. That would have been an unfortunate — but also very human — response.

But President Bush did not do those things.

Though he didn’t have to, though it wasn’t required of him, he thought it important to make the new president feel, as Clinton himself later said, “as much at home as he could.”2 He decided to emphasize unity, respect, and goodwill over bitterness.

And that, to us, is the whole point of a day like Presidents’ Day.

As you know, there have been forty-five different presidents in our country’s history, across forty-seven presidencies. (Presidents Cleveland and Trump served/are serving non-consecutive terms.) These men were all very different, with different philosophies, styles, beliefs, opinions, and ambitions. That makes sense, because we are and have always been a country made up of different philosophies, beliefs, opinions, and ambitions.

But no matter our differences, all those presidents — and all of us — still have two things in common: A shared love for our country…and a mutual benefit whenever we place unity, respect, and goodwill above our differences.

President Bush’s letter established a tradition of leaving a note for the next commander-in-chief.3 As chance would have it, each president’s note has been to a member of the opposing party. Bush to Clinton, Clinton to Bush. Bush to Obama, Obama to Trump. Trump to Biden and back again. None of these men, it is fair to say, agreed very much with each other. But each chose to continue the tradition. Each chose to stress unity and goodwill over bitterness.

Our country is strongest when we emphasize these values. When we remember that even those who disagree can still show respect for one another.

While it’s not as important as Independence Day, or as hallowed as Memorial Day, we think this holiday is still a wonderful opportunity to exercise our patriotism…and to remember that what unites us will always be more powerful than what divides us. To paraphrase President Bush, the more each of us succeeds, the more we all succeed. And the harder we root for each other, the better off we all will be.

On behalf of everyone at Minich MacGregor Wealth Management, we wish you a happy Presidents’ Day.

1 “Note from President George H.W. Bush to President Bill Clinton,” Clinton Digital Library, https://clinton.presidentiallibraries.us/items/show/101724
2 “The letter George H.W. Bush left for Clinton is a lesson in grace,” CNN, December 1, 2018. https://www.cnn.com/2018/12/01/politics/george-bush-bill-clinton-letter-trnd/index.html
3 “Letters left by U.S. presidents to their successors,” Ballotpedia, https://ballotpedia.org/Letters_left_by_U.S._presidents_to_their_successors

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Important Updates for the 2024 Tax Year & When 1099s Will be Available

Written by Minich MacGregor Wealth Management on . Posted in Uncategorized.

A new year means new tax changes.  While Congress didn’t pass any major tax reform last year, some tax provisions have been updated that could affect how much money you keep and how much goes to Uncle Sam. 

Here, we’ve included some of the most significant changes for investors and retirees.  Please note that these changes relate to your filing for the 2024 tax year.  Our suggestion: Look over the material below and circle anything you have questions about.  Then, feel free to share this letter with your tax professional!  They should be able to answer any questions you have.  Of course, our team is also available to help in any way we can.

We understand that tax season can be stressful, so we want to make this process as smooth as possible for you.  Schwab issues Form 1099 Composite in three phases, with most forms available in mid to late February. You can access your tax documents as they become available by logging into Schwab Alliance using your User ID and password.  If you have not opted for paperless delivery, your tax documents will be mailed to you.

To help reduce the stress of tax season, feel free to have your accountant or tax preparer contact us directly for any investment information needed.  We are always happy to coordinate with other professionals you work with to minimize your workload. 

As always, if there’s anything our team can do to be of assistance, please let us know.  Have a great week!

Important Updates for the 2024 Tax Year

Changes to Federal Tax Brackets1

As it often does, the IRS has adjusted the 2024 tax brackets based on inflation.  These adjustments are smaller than in 2023, as inflation has slowed considerably.  Thus, while tax rates have not changed, bracket ranges increased by about 5.4%.2 

The brackets for the 2024 tax year are as follows:

Tax RateSingleMarried, filing jointlyHead of Household
10%0 to $11,6000 to $23,2000 to $16,550
12%$11,601 to $47,150$23,201 to $94,300$16,551 to $63,100
22%$47,151 to $100,525$94,301 to $201,050$63,101 to $100,500
24%$100,526 to $191,950$201,051 to $383,900$100,501 to $191,950
32%$191,951 to $243,725$383,901 to $487,450$191,951 to $243,700
35%$243,726 to $609,350$487,451 to $731,200$243,701 to $609,350
37%$609,350 and up$731,200 and up$609,350 and up

Changes to Capital Gains3

The income threshold for long-term capital gains rates has also gone up. 

Tax RateSingleMarried, filing jointlyHead of Household
0%0 to $47,0250 to $94,0500 to $63,000
15%$47,026 to $518,900$94,051 to $583,750$63,001 to $551,350
20%$518,900 and up$583,750 and up$551,350 and up

Changes to Deductions4

As you know, when you file your taxes, you can either claim a standard deduction or dive into the details and itemize your deductions.  (Since the passing of the Tax Cuts and Jobs Act back in 2017, most people choose the former.)  Per the IRS, the standard deduction is “a specific dollar amount that reduces the amount of income on which you’ve been taxed.”5

Due to inflation, the IRS has also increased the standard deduction for your 2024 taxes.  For singles, the standard deduction is now $14,600, up from $13,850.  For married couples filing jointly, it is $29,200, up from $27,700.  For heads of households, the standard deduction is $21,900, up from $20,800. Remember, you can’t take the standard deduction if you also itemize deductions.  And for married couples filing separately, both spouses must take the same type of deduction. So, if one spouse chooses to itemize, the other spouse must as well.

Changes to Alternative Minimum Tax (AMT) Exemption Levels4

When Congress passed the Tax Cuts and Jobs Act back in 2017, the number of Americans who owe the AMT has been drastically reduced.  But in case you fall under this category, the exemption levels for 2024 are as follows:

SingleMarried, filing jointly
0 to $85,7000 to $133,300

These exemption levels begin to phase out at $609,350 for single individuals and $1,218,700 for married couples filing jointly. 

***

We hope you found this information helpful.  Obviously, it’s not a completely exhaustive list of every change for the 2024 tax year.  But it is an overview of some of the most important ones.  If you have any questions or concerns, please let us know.

Sources
1 “Federal income tax rates and brackets,” Internal Revenue Service, https://www.irs.gov/filing/federal-income-tax-rates-and-brackets
2 “Tax brackets for 2024 (for taxes due in 2025),” CNBC, https://www.cnbc.com/select/federal-income-tax-brackets-tax-rates/
3 “Capital gains and losses,” Internal Revenue Service, https://www.irs.gov/taxtopics/tc409
4 “IRS provides tax inflation adjustment for tax year 2024,” Internal Revenue Service, https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2024
5 “Standard Deduction,” Internal Revenue Service, https://www.irs.gov/taxtopics/tc551

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MLK Memorial

Honoring Dr. King’s Legacy: Inspiring Words for Today and Every Day

Written by Minich MacGregor Wealth Management on . Posted in Articles, Posts.

Happy Martin Luther King Jr. Day!

Dr. King’s words have always been a source of inspiration to many. Even though they were written decades ago, they continue to resonate deeply and remind us of the power we all have to make the world a better place.

One of Dr. King’s most impactful writings, Letter from Birmingham Jail, was penned in 1963 while he was imprisoned for participating in nonviolent protests against segregation in Birmingham, Alabama. In the letter, King responds to criticisms from local clergymen who called his actions “unwise and untimely.” Rather than retreating, Dr. King used the opportunity to explain why he felt it was not only necessary but urgent to fight for justice. Though his words were shaped by the challenges of his time, they still hold incredible relevance today.

This year, as we honor Dr. King’s legacy, we took some time to revisit this powerful letter. It’s not an easy read. It’s a letter born of frustration, written in the face of incredible injustice. But it’s also a letter filled with hope, resilience, and a call to action that still rings true today.

There were a few quotes that stopped us in our tracks as we read, and we wanted to share them with you—not just for what they meant then, but for what they can mean to us now.

“Any law that uplifts human personality is just. Any law that degrades human personality is injust. Segregation…substitutes an “I it” relationship for an “I thou” relationship and ends up relegating persons to the status of things.”

This line reminded us of how easy it can be to lose sight of someone’s humanity. It’s something we see every day, whether in the rush of our busy lives or in moments of conflict and misunderstanding. Dr. King’s words challenge us to slow down, to really see the people around us—not just as roles or labels, but as individuals with their own stories, struggles, and dreams. Small acts of kindness, even something as simple as a smile or a kind word, can remind someone (and ourselves) of that shared humanity.

“Injustice anywhere is a threat to justice everywhere. Whatever affects one directly affects all indirectly.”

This is such a powerful reminder of how connected we are. When someone in our community is struggling, it isn’t just their burden—it’s something that ripples out and affects us all. But the same is true of hope and kindness. When we choose to lift each other up, those small actions can grow into something much bigger. They create a ripple effect that brings us all closer together and makes our communities stronger.

“So the question is not whether we will be extremists, but what kind of extremists we will be. Will we be extremists for hate or for love?  Will we be extremists for the perseveration of injustice or for the extension of justice?”

This quote makes us pause and reflect on the importance of taking a stand for our values. Dr. King wasn’t advocating for division or conflict; he was challenging us to think deeply about what matters most to us. It’s easy to stay neutral, to avoid uncomfortable conversations or hard decisions—but there are moments when silence isn’t an option. Whether it’s standing up for fairness, supporting a friend, or choosing kindness in the face of disagreement, we all have the power to leave a meaningful impact through the principles we choose to uphold.

As we reflect on these quotes, we’re struck by how relevant Dr. King’s words remain. They inspire us to approach the world with more compassion, to act with intention, and to believe that even small, everyday choices can make a difference.

On this Martin Luther King Jr. Day, we hope his teachings inspire you as much as they inspire us. Let’s honor his legacy by carrying forward his ideals—not just today, but every day. Let’s find ways to connect, to uplift, and to act with the courage and love he so powerfully demonstrated.

On behalf of everyone here at Minich MacGregor Wealth Management, we wish you a meaningful and reflective day. May Dr. King’s vision inspire us all to keep building a brighter future together.

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Smishing Texts

Urgent Alert: Beware of Smishing Text Scams Targeting Schwab Clients

Written by Minich MacGregor Wealth Management on . Posted in Uncategorized.

Smishing Threat Campaign

Schwab has alerted us that there is an active phishing text campaign in which clients receive a text message from an international number and it mentions a disbursement from the client’s account. It then asks to click on a link to log into their account to verify the transaction.  

  • The texts are coming from different international phone numbers.
  • The texts notify that an ACH was debited from their Schwab account, typically in the thousands of dollars.
  • The text then instructs the client to cancel the disbursement if they did not request it, by replying “Y” and clicking on the link provided.
  • The link’s URL is a variation of a spoofed Schwab domain For example https://schwbba.com, https://schwabd.com, https://schwbab.com, etc. 

Be aware:

  • Schwab does not notify client about completed transaction via text message.
  • Schwab does not send out text messages from international numbers.

Keep in mind: Unlike many other attacks, smishing isn’t necessarily an indication that the client has been compromised—the attackers send a message to a large number of randomly chosen phone numbers, hoping some of those people will respond. 

Steps to follow if you suspect smishing:

  • Take a screenshot of the text and forward it on to phishing@schwab.com (Make sure the phone number is visible).
  • Delete the text message.
  • We strongly encourage you to add security measures on your Schwab accounts, such as two-factor authentication and verbal password. 
  • Report suspicious or fraudulent activity in your accounts as soon as possible, including if you entered your Schwab credentials into a fake website.

Note: If you have clicked on the phishing link, you should run an anti-virus and anti-malware scan on your device.

Remember:

  • Do not click on links or attachments included in a text message. 
  • Slow down if a message is urgent. Urgent account updates and limited time offers are red flags of possible smishing. Remain skeptical and proceed with caution. 
  • Avoid using links or contact information from the message. Go directly to the official channels/websites.
  • Double check the phone number. International numbers or odd looking numbers, such as 4-digit phone numbers, are tactics that scammers use to mask their true phone number. 
  • Do not enter your Schwab credentials or other personal information via an unverified link. Instead, enter the address you are familiar with directly into your browser to visit the trusted website to log in as usual. 
  • Double check that the URL is not a subtle variation of the real one.
  • Do not call phone numbers received through unsolicited messages. Always use a verified number that you have used in the past or is found on your account statement.

We are here to help.  Please feel free to reach out to us if you have any questions.

Visit our Cybersecurity page to learn valuable tips on safeguarding yourself and your finances from hackers, scammers, and identity theft.

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2024 Year in Review image

2024 Year in Review: Lessons Learned & Navigating Uncertainty in Investing

Written by Minich MacGregor Wealth Management on . Posted in Featured, News, Posts, Uncategorized.

Every January, we here at Minich MacGregor Wealth Management look back on the year that was. What were the highlights? What were the “lowlights”? What events will we remember? Most importantly, what did we learn? Then, we send a Year in Review message to our clients that encapsulates it all. We thought you might be interested in seeing it this year, too.

When we ponder the last twelve months, the theme of 2024, to us, is the importance of being able to operate under uncertainty. Here’s what we mean.

When the year began, there were several question marks hanging over the economy, the markets, and the nation as a whole. Each question mark, on its own, was important. Putting them all together made it extremely difficult for investors to know how the year would play out, which way the markets would go, or how the economic climate would evolve. In other words, there was a great deal of uncertainty. Let’s go through a few of the most important question marks one by one.

Which Way Will Inflation Go? The New Year kicked off with a positive outlook. Consumer prices had fallen significantly toward the end of 2023, and the expectation was that the trend would continue. But inflation rarely moves in a straight line. The inflation rate hovered around 3.1% in January, but by March, it was back to 3.5%.1  Inflation, it seemed, was still “sticky.”

This wasn’t pleasant news for the markets, because it dashed any hope that the Federal Reserve would cut interest rates in the spring. And the longer interest rates remained elevated, the more people worried about the possibility of a recession. As a result, the markets experienced a short-but-sharp dip in April.2 

Fortunately, the angst was short-lived. Over the next six months, inflation fell to 2.4% — the lowest since February of 2021, and awfully close to the Fed’s goal of 2%.1  That led to a long-awaited event in September, when we finally got some clarity on the second question mark:             

When Will Interest Rates Start to Come Down? Interest rates — the Fed’s primary tool for combatting inflation — began the year at 5.3%.3  That was the highest they’d been since early 2001. But while higher rates are effective at bringing prices down, the reason is because they cool down the economy. But if rates remain too high for too long, that coolant can ice over — and freeze the economy with it. Because of this, and because lower rates tend to juice the stock market, investors had been waiting with bated breath for any signs that rates were on the verge of coming down. Finally, in September, it happened: The Fed announced the first rate cut. Another one followed in October, and a third in November. By the end of the year, rates were down to 4.6%.3  That’s still historically elevated, but it’s a step in the right direction. That’s because we were also getting a positive answer to the third question mark:

Will the Economy Grow, or Slow? Predicting a recession has become something of a parlor game for economists. It’s not hard to understand why. Historically, raising rates to pull down inflation has almost always led to a recession. It’s called a hard landing, and it happens when prices come down so much that most businesses experience a major drop in revenue, causing them to lay off workers. Since unemployed people tend to spend less money, the economy contracts and enters a recession.

Despite years of dire predictions, this worst-case scenario never came true. Our gross domestic product, which measures our country’s total economic activity in a given period, grew by 1.6% in the first quarter, 3% in the second, and 3.1% in the third.4  As of this writing, we don’t have firm data for Q4 yet, but it’s estimated to be around the same.5 

Against all odds, for now, it seems we’ve achieved something rare: A soft landing.  

What About the Election? The fourth question mark was perhaps the least important as far as the markets were concerned, but it was also the one that got the most headlines: The November election.

Elections always create uncertainty, of course. Who will our next president be? What policies will they enact? How will they help or hurt my personal situation? History suggests that it doesn’t really matter which party controls Washington as far as the markets are concerned, but despite that, we do often see volatility leading up to the election itself. But that didn’t really happen this year. Other than a slight, brief dip at the very end of October, there was not a lot of volatility before the election, nor right after.6  Which brings us to our final question mark:

How Will the Markets React to All This? For investors, this was the biggest question mark of all. It’s always the biggest question mark of all. How would the markets react to the roller coaster of inflation? How would they react if it took longer for interest rates to drop? What about the election?

Well, now we know the answer to that, too. The S&P rose over 23% for 2024.7  When you couple that with the 24% gain we saw in 2023, it’s the best two-year performance in the index since 1997-98. The Dow, meanwhile, gained nearly 13%, and the NASDAQ over 28%.7   

Because we are looking back, because we know the answers to all these questions, it’s hard to remember the uncertainty that crept up at different points in the year. Nevertheless, uncertainty existed — and the investors who could handle it, benefited. The ones who could not, did not. We’re very happy to say that our clients belonged to the first group, but we know many people who didn’t.

Throughout the year, especially early on, we would often hear acquaintances of ours say things like, “I’m not getting into the markets until after the election.” Or “I’ll wait until interest rates come down to make a decision.” “Inflation is still too high for me, so I’ll think about it next year,” also popped up from time to time. In other words, many investors find it difficult to operate under uncertainty. Any question mark causes them to defer decisions and delay actions. Uncertainty can cause people to shut down, circle the wagons, and “turtle up.” As a result, two things happen:

  1. They miss out on the kind of year we just experienced in the markets.
  2. They don’t move forward to their financial goals.

Uncertainty is a fact of life, and as investors, we will always be dealing with question marks. Some years, there are more question marks than others, and that can certainly make things stressful. Of course, when we’re faced with uncertainty, it’s always good to slow down, take our time, and consider our options carefully. But it’s not good to become stagnant, hesitant, or fearful. It’s never good to procrastinate.  

Scientists have often held that one of the hallmarks of intelligence is the ability to make judgments under uncertainty. The ability to plan ahead even with limited information, and then adjust your plan as you learn. This is something that our team strives to do every day for our clients. We consider what we know and what we don’t. We try to identify possible outcomes and events, not to predict which will happen — which is impossible — but to prepare for as many as we can. From there, we determine what choices must be made now, which choices can be made now, and which should not be made now. Finally, we review the options that come with each choice, and which work best for each client based on their specific goals, needs, and situation.

It doesn’t mean everything will always go the way we want it to. It doesn’t mean we won’t occasionally experience setbacks. It does allow us to operate under uncertainty…which means we can always help our clients continue to work towards their dreams and financial goals.     

That’s what financial planning is all about. And that, to us, is the lesson to take from 2024.

Of course, there will be question marks in 2025, too. Here are just a few:

  • Is the inflation roller coaster truly over? Consumer prices ticked back to 2.6% in November, and there are some indications that they may rise higher still in the coming months.
  • President-elect Trump has promised to levy across-the-board tariffs against China and many other countries. What effect will those tariffs have on the economy, especially inflation?   
  • Will interest rates continue to fall, or will they remain where they are for a while? In its most recent statement, the Fed projected only two cuts for 2025.8 
  • Much of the market’s performance over the last two years has been generated by tech companies, especially those investing in AI. However, to date, many AI companies are valued far above what they are actually earning. Will that change in 2025? Will the hype continue?     

Here at Minich MacGregor Wealth Management, we’ll continue to study these issues…and even though you are not currently a client, we will update you as we get answers. But while there will always be question marks, we remain confident in our direction and in our ability to keep moving forward — whether the horizon is clear or blurry, the sky blue or gray.

So, that’s 2024! We hope it was a wonderful year. On behalf of our entire team, we look forward to making 2025 even better. As always, please let us know if you have any questions, or if we can ever help you and your family the way we help our client families. Have a Happy New Year!

Sources:
1 “12-month percentage change, Consumer Price Index,” U.S. Bureau of Labor Statistics, https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm
2 “U.S. Equities April 2024,” S&P Dow Jones Indices, https://www.spglobal.com/spdji/en/documents/commentary/market-attributes-us-equities-202404.pdf
3 “Federal Funds Effective Rate,” Federal Reserve Bank of St. Louis, https://fred.stlouisfed.org/series/FEDFUNDS
4 “Gross Domestic Product,” U.S. Bureau of Economic Analysis, https://www.bea.gov/data/gdp/gross-domestic-product
5 “GDP Now,” Federal Reserve Banks of Atlanta, https://www.atlantafed.org/cqer/research/gdpnow/archives
6 “S&P 500 ends 5-month rally with October downturn,” S&P Global, https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/s-p-500-ends-5-month-rally-with-october-downturn-86066097
7 “S&P 500 posts 23% gain for 2024,” CNBC, https://www.cnbc.com/2024/12/30/stock-market-today-live-updates.html
8 “Fed cuts key interest rate but signals elevated inflation is likely to persist,” https://www.nbcnews.com/business/economy/federal-reserve-interest-rate-cut-december-2024-much-economy-rcna184586

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