Ep 62: 2022 Preview
The X's & O's
With 2021 in the rearview mirror, Brent, Matthew, and Joshua look ahead to what the rest of 2022 may have in store for us.
The Hosts:
Brent Pasqua, Matthew Theal and Joshua Winterswyk
Transcript:
Brent Pasqua: We’re back, guys. 2022. Finally, back in here. How’s it feel to be back?
Matt Theal: It’s good. We had an interesting start to the year, some up some downs, but happy to finally be with the three of you recording the podcast.
Joshua Winterswyk: I’m still processing this new year. It’s just all been a big, big blur.
Brent Pasqua: Why is it a blur for you?
Joshua Winterswyk: My wife and I were expecting, and we had our little baby boy bundle of joy at the beginning of January. So we are just so happy and blessed and just enjoying the little guy. Time is traveling very fast. And I told Matt when I got in, I didn’t even know it was the new year.
Brent Pasqua: Yeah. This is actually the first time that we’ve seen you since you had your kid.
Joshua Winterswyk: I know. Yeah. It’s nice to see you guys and just-
Matt Theal: Congratulations.
Joshua Winterswyk: Thank you. Thank you. And just awesome experience. And we’re just, we’re so in love with the little guy and just enjoying him, so. But it’s just gone by so fast and he’s already growing and really, really cool.
Brent Pasqua: Well, congrats. And we’re excited for you both. And we, Matt and I were wondering if you were still going to show up or if you were coming or when you were going to come, but we’re excited to have you.
Joshua Winterswyk: 2021 was a lot of grinding getting ready for this baby too. And I was like, “You guys just need to leave me alone for a little bit.” Right? I finally get a break from you guys.
Brent Pasqua: Take it from here.
Joshua Winterswyk: Exactly.
Brent Pasqua: How’s your year been, Matt?
Matt Theal: Oh, it’s been fun. I’ve had a good year, fun start to the year, looking forward to 2022, having some good fun and over in the stock market land it’s pretty boring last year. But I think some excitement’s picking up yeah.
Brent Pasqua: Yeah, today and this rest of this week and this year so far, I mean, it’s been keeping things very interesting. And so that’s what we’ll talk about today. We’ll talk about where the market’s at so far this year and what our thoughts are around it. But as we get into that, is there any new year’s resolutions you’ve created as you kind of head into this first month?
Matt Theal: Yeah, I’ll go first. I have a couple, but I’ll start with this one. I got to get rid of this tire around my belly. Every year I’ve gotten a little older, I feel like I’ve gotten a little heavier and towards the end of last year, I had to order some pants. A new size of pants, which is a sign it’s like, “All right, come on, come on guy.”
Matt Theal: So I was like, “All right, I’m going to go through the holidays. I’m going to enjoy myself. Then I’m cut back and, get in on the salads and the Peloton a little bit more, do a little bit more exercising.” And then my other one is to stop trying to worry so much of my life and just go back to kind of how I used to live my life in 2019 before the pandemic started. So that’s another resolution of mine as well.
Brent Pasqua: So did you buy a lot of pairs of pants in this upper size or did you just buy one pair and you’re going to adjust back down to your old size?
Matt Theal: I’ve bought enough to last me for a week of work.
Brent Pasqua: Got it. All right. What about you?
Joshua Winterswyk: I haven’t even thought of it. It’s just been a big blur this last month, the holidays, the baby, I was just going to listen to your guys’ resolutions. See which ones I liked too. Matt, if you want to start a Peloton competition, I’m down to drop some lbs as well. So that sounds good.
Brent Pasqua: So every year as we go into a new year, I create a laundry list of just personal goals, business goals, whatever. I make so many of them out and I always list them out and try to track them throughout the year and see where I’m at and keep focused on what my goals are. But I think a continuous goal for everybody is, continue to eat healthy. It’s that time of our lives where we have to eat healthy, workout, exercise, and the healthier things you put in your body, the better you’re going to feel. And I think that’s so important. I mean, after you come out of these holidays, you feel sluggish. You don’t feel as good. You’re in the new year, let’s get back on track and eat healthy and create a little bit more positive feeling in your body.
Brent Pasqua: All right. So let’s get into the headlines. Microsoft is spending 75 billion to buy video game maker, Activision. Activision makes Call of Duty, World of Warcraft, Candy Crush, and many others. But the plan is to turn Microsoft Game Pass service into a Netflix type gaming service. This seems like a pretty substantial move for Microsoft, probably something that didn’t happen quickly. And so everybody knows Microsoft also owns the rights and makes Xbox, so what’s actually happening here?
Matt Theal: Yeah. Good question. So it’s Microsoft’s biggest acquisition ever. I mean, it’s a big chunk of money, right? $70 billion. And when the new gaming consoles came out, there’s a PS5 and a Xbox One X, I think it’s called, but just call it Xbox NextGen. And Xbox or Microsoft released this service to go with it, it’s kind of like a Netflix where you pay a monthly fee and you could stream video games for that service. And unfortunately it doesn’t have all the video games on it, because there’s licensing and whatnot. And so Activision is one of the larger producers of video games. They have quite a few popular titles that you listed. I’m sure a lot of people here have kids or grandkids who play the Call of Duty. I mean, that thing was popular when I was in college and it’s still popular, 20 years later.
Matt Theal: And their whole goal is to turn that game pass into the Netflix of gaming. So you just fire up your Xbox, you go to your Game Pass, I guess, app. And then, they want there to be a library of a hundred or 200 games that you could just click on and start playing immediately without having to pay the 60, $70 that a video game costs. So they’re building that out and I actually would potentially expect them to make maybe a few more acquisitions down the line as they continue to build out that service.
Brent Pasqua: Now that they own this company, will they still allow other game consoles like PlayStation to use or play these games? Are they just going to be solely on their systems?
Matt Theal: That’s a great question. I actually don’t know if they’ve said that or not, but they could absolutely move to doing an exclusive like, “This is an Xbox version of the game only.”
Joshua Winterswyk: Yeah.
Brent Pasqua: That I would assume. And my knowledge is limited in the, the gaming space, but that seems like it would really shake everything up.
Joshua Winterswyk: Especially with popular titles that are already have a really big following. And like you said, such a big acquisition. I mean, these respectively on their own are both top 10 in like gaming revenue. So Microsoft acquiring Activision is really big. And I think that it’s good as even an investor of Microsoft that they’re not sitting on their hands and they’re making this push for new service and a new model because it has been successful as you see a lot of these other subscription type services in other industries.
Matt Theal: Yeah. I mean, and with their game pass, I mean, if you do play video games they get two or three games on there that you play during the course of a year, then buying the game pass is a no brainer for you because you could try other games. But then it’s also the cost annually of about what two or three video games, so.
Brent Pasqua: Yeah. If the industry’s going this way, it doesn’t make any sense to buy individual games anymore. Right? You’re just going to buy the service and then you have access to more games. And then why would you ever want to buy individual games at this point?
Matt Theal: Unless your game isn’t on the service. That’s the only reason.
Brent Pasqua: Yep.
Matt Theal: So I think the next big one is EA, Electronic Arts. They make all the sports franchises or the majority of them. And if Microsoft ever strikes a deal or a partnership with Electronic Arts and gets those exclusive, then I think you’ll see just a tidal wave of people coming over into Game Pass.
Brent Pasqua: Microsoft, trying to create a monopoly again or?
Matt Theal: Yeah, it kind of seems like it.
Brent Pasqua: Another big story. And I think this is huge in, in what’s happening in the market, in the economy, Joe Biden’s approval rating hit a new low at 44%. It seems every time I see this headline it’s dropping even lower and lower. It’s probably in the thirties by the time that this thing gets launched. Inflation and frustration over the economy is the number one problem. 72% of people surveyed disapproved the handling of price of goods. Why is this keep dropping? This thing’s a mess. We’re going in the wrong direction obviously. Is this going to be fixed and what’s happening?
Matt Theal: Yeah, I think this is going to be probably one of the major stories of 2022 is just how unloved Biden is. He’s basically has an approval rating of Trump. It might even be a little bit lower than Trump. For those of us who were alive in the late seventies. You remember Jimmy Carter was the president. It really looks like Joe Biden is turning into a kind of a Jimmy Carter type for president. He will most likely be one and done. The economy just hasn’t went his way with inflation. A lot of the bills he passed, haven’t really helped with keeping the economy strong and with inflation kind of in check, I guess it’s kind of caused a little bit more inflation. And people aren’t happy. I mean, I drive a Toyota Prius. It costs me $42 to fill that Prius up the other day. That’s an all time high for me. It usually costs 28, 29, $30.
Brent Pasqua: And you bought it so you weren’t paying that much in gas.
Matt Theal: Yeah. But then when I look at the pump and I see what other people are paying, right. Because you could see the previous price. I see 90, 100, $120 probably to fill up those big SUVs and trucks and that’s ridiculous.
Brent Pasqua: Yeah.
Matt Theal: How can the average family afford that? They can’t. So, I mean just the handling, the economy, the policies, I mean, he’s going to end up losing a seat or most likely looking at a red wave in the November midterms. So yeah. That’s why we always say, if you don’t like the president, don’t worry, it’s a short cycle. They’ll most likely be out.
Joshua Winterswyk: And you’re already seeing even some of the people in his own party disapprove.
Matt Theal: Yeah.
Joshua Winterswyk: And I think it’s a little shocking because these numbers are dropping even though we’ve had last year, some good market returns too. A lot of times people correlate stock market performance or returns and their pleasure with the president, but that’s just been overshadowed and a lot with COVID and healthcare and all of that stuff. So just an interesting headline. And I agree with you, Matt, we’re probably going to be seeing a lot more of this, this year.
Brent Pasqua: And I think the frustrating part from my end and I know everybody has such strong opinions about politics, but my gosh as this country, can’t we find a candidate or a person that can actually run this country correctly and actually make us a better place and not be dealing with this every single time, every new administration.
Joshua Winterswyk: Yeah. And just less division. I mean, it just seems like we’re becoming even more divided we need someone to kind of unite us a little bit.
Brent Pasqua: Yeah. We need a rally here and it’s not going well.
Matt Theal: I have a slight prediction on that. So in the, I think it was in the seventies, right. There was Nixon and Jimmy Carter around that time. And both were pretty much lame duck presidents kind of what it looks like Trump and Biden were going to end up being. And then after that we just got a reign of great presidents. So hopefully something like that happens again.
Brent Pasqua: Yeah I think that’s what we can hope for.
Matt Theal: That’d be great.
Joshua Winterswyk: Yeah, absolutely.
Brent Pasqua: All right. Let’s get in the retirement planning corner, let’s get into the heart of the show. We want to talk about where the market has been in that last quarter of 2021. What’s going to look like this year and some of the concerns that we’re already starting to see, there’s a lot of red this year. And so will that eventually turn green? Is there opportunity there? What should we be doing when it feels like the sky might be falling? But let’s start with the market check. Joshua, how did the global markets fare in the fourth quarter last year?
Joshua Winterswyk: Group rank? Yeah, I’m going to start with US stocks. So given the returns from each of these classes here, starting with US stocks, we had in the fourth quarter, a return of 9.28. International stocks, 3.14. Emerging market stock, a negative return of 1.31%. Real estate, 12.53. US bonds 0.01%. So pretty stable segment there. And then global bonds, 0.07%.
Brent Pasqua: And how did the markets fare for all of 2021 as we kind of finished? Because I think in that fourth quarter, right? The market really in the heart of December, it started to go down a lot. And then at the end of the year, for whatever reason, just like the rest of the year, it rallied really strong. It felt like we were going to lose a lot of our returns if the year ended on December 20th, 22nd, somewhere in that range, 23rd, we probably weren’t going to have that great of a return ending. But how did it fair at the end of the year with that sort of end of the year rally?
Joshua Winterswyk: I think just Matt, before you read off the year, I think what’s a win, especially for the fourth quarter. And if you listen to our podcast, probably at the end of the third quarter as US stocks being up 9% in that fourth quarter.
Brent Pasqua: Huge.
Joshua Winterswyk: I mean we were looking pretty dark and gloomy heading into that fourth quarter with a lot of just new negative news and to get 9% in that quarter, to me is just a highlight of that fourth quarter returns sheet.
Brent Pasqua: It seems like the market was just waiting for that year to turn. And then after that it was all red from there.
Joshua Winterswyk: Here, we’re going to give you a little bit of little bit of dessert and now we’re moving on.
Brent Pasqua: So how did all of last year fair?
Matt Theal: Yeah. So last year was another incredible it for stocks. The US stock market as a whole is up 25%. International stocks, 12.6%. Emerging markets down 2.5%. Real estate up 31%, I’m sure most people saw this in their housing prices. Bonds down 1.5% and then global bonds down 1.4%. So stock market good, real estate good, bond market not so good.
Brent Pasqua: Why has US markets done so incredibly well the last three years considering everything that’s happened?
Matt Theal: There’s been a lot of stimulus, as we know. We’ve been in a low rate environment, which is supportive of higher stock prices and the economy’s actually been pretty strong. There’s been pockets of the economy that have been weak in a given period for a lot of that kind of that COVID lockdown period the restaurant industry was really poor. But other industries like tech stocks, the tech industry as a whole, were doing really well as everyone shifted to remote work. So while there were areas that might have been poor, there was areas that were really strong. And then last year, just as a whole, the economy was incredibly strong as we rebounded out of COVID.
Brent Pasqua: So as we sort of end and finish with last year and we turned the page on last year and we hit into this year. We obviously to see that there’s a lot happening very quickly this year or several weeks into the year, what is actually happening so far this year in the market?
Matt Theal: So underneath, during the market, during probably the last call it two or three months, what started to happen last year was the bond market as judged by the US treasury rate, there’s the three month, the six month, the one year, the two year, the five year goes on up until the 30 year, right? There’s also a 10 year bond. All those interest rates started moving higher. And what the bond market was saying was, “Hey, we’re not putting up with 7% inflation.” Rates are going higher, the federal reserve said that they’re be raising rates and pairing off the kind of stimulus they had been putting into the economy.
Matt Theal: And that’s causing stocks to fall down. So then the stock market looks at the bond market and says, “Well, the bond market’s repricing risk assets right now. So we’re going to reprice stocks.” And so now stocks are starting to come in. You’ve seen it with a ton of stocks last year, small caps didn’t do that well. There’s quite a few small caps that lost 50, 60% value. One stock right now, there are two stocks that are getting absolutely crushed in the market are Peloton and Netflix, Peloton I think has lost 70% of its value. And as of today we’re recording Netflix stock is down 20%. So these companies really aren’t reporting anything too awful. They’re reporting slightly poor news, but the market’s just repricing them into kind of different price multiples.
Joshua Winterswyk: Yeah. And with interest rates going higher, the cost to borrow, right, goes higher. And so reassessing the projected profits of these companies is going to change and the landscape’s going to change. And we talked about it a lot last year that the news has also kind of changed. Inflation’s going higher. We’re kind of recovered from that original hit from COVID. So it’s going to be a different landscape in 2022 and with interest rates going higher, we don’t have all of the answers yet for these companies and maybe the revenue numbers or reporting earnings to some of these companies can save them in this first and second quarter from this downturn, but it’s not looking too great from what we see so far.
Brent Pasqua: With bond returns down this year already and stocks down this year as well. How common is it them to be both down at the same time?
Matt Theal: It’s very uncommon. Most likely if they’re both down, the correlation will break after a few days. I would expect that to happen as interest rates slowly make their way till 2%, I would expect a lot of investors to want bonds. Two percent’s a pretty good rate of return. We haven’t had that in the market in a while. So if you could lock in 2%, in a couple years in US treasuries, it’s not a bad deal. Especially as the United States is one of the highest creditors out there.
Matt Theal: As for the stock market, I just would expect a lot of volatility like we’re seeing this year. I wouldn’t be shocked if by the time this podcast drops, the market’s down to 10 or 15%, but then it’s going to rally back up and then it’s going to drop again. And that’s just what happens when you’re in a rising interest rate environment. We’ve had really killer returns over the past 10 year period. It’s time for the market to be just a little bit more volatile and give some of that back.
Joshua Winterswyk: I think you made a great point. We can’t forget how great returns were, right? So a little bit of a reset as things are changing as the economic environment changes, isn’t necessarily a bad thing. It can project us into an even better place going forward. But I think that we can’t be too upset because of how great returns were last year and even the two years before
Matt Theal: And there’s a lot of opportunities already out there. And the market’s only off by about five or 6%. So I mean, I mention Peloton, right? I mean that stock’s down huge. I mean, pretty soon the bottom’s going to be putting out and you’re buying Peloton at 20, $30 a share when last year it was up at 150.
Brent Pasqua: How much did the big tech stocks really control or help the market the last three years? When you look at Microsoft and Tesla and Apple and Facebook and Google. When you look at those, I mean, how much did they actually contribute to this?
Matt Theal: They helped a lot. They drove a ton of last year’s return. The market was pretty poor last year, outside of those big tax stocks. And this year, they’re kind of holding things up a little bit. If they start to come in, that’s where I think we see that 10, 15% correction.
Joshua Winterswyk: They lagged in the beginning of last year though, too. And they really made that recovery second half-
Matt Theal: Third quarter.
Joshua Winterswyk: Second half of the year. So maybe we’re even seeing a little bit… I mean, we’re seeing that already just in the few weeks of January, but if we are remembering last year, it kind of started somewhat similar with tech stocks lagging.
Brent Pasqua: So with what’s happening right now, I mean, what are the long term stories that we’re going to watch and follow to see really how things are going and what are some headlines we should be paying attention to?
Matt Theal: On my end, a lot of people are probably going to say inflation, it sounds like inflation will be coming in kind of naturally I think over the next kind of three to four months, we’re going to start to get some inflation readings that are negative year-over-year, I believe. So that would be great. I think to the… What would be shocking is if actually we start to get higher inflation than what we’ve currently had. So most likely inflation’s going to be peaking around 7%.
Matt Theal: But what I’m really, really interested in watching personally is the price of oil right now. Oil is continuing to go up. That’s not good. There’s a certain price where when oil gets too high, I was mentioning that price at the pump, it just hurts the average everyday American, too much to fill up that car. And when that happens, that causes a recession, oil ran up all through 2006, 2007. And then by 2008, we were in a recession.
Brent Pasqua: Does it normally go from such inflationary state to a recession that quickly?
Matt Theal: Yes. You won’t know it for a few months, but yeah, it’ll end up getting backdated. So I mean, we could be on course for early summer recession, but most people wouldn’t know it until the fall, if that makes sense.
Joshua Winterswyk: Yeah. And that data is trailing the past, right. Any economic data is. So we’re not going to know, but you could probably logically see it happening, like you’re even just pointing out. There’s the writings already kind of a little bit on the wall. We just have to monitor and watch it. I think a couple other news stories or long-term news stories is just mid-term elections. Right? Those are coming up. That’s going to be a big key. I mean, our headline was Joe Biden’s approval rating. We’ll see how those turn out.
Joshua Winterswyk: And then just kind of like COVID right. I mean, that’s still here, how that pans out and to see how it’s handled even politically, I feel like most of the COVID talk now is tied politically, which it probably shouldn’t be, but how is that going to be handled? Are we still going to see everyone have different views on COVID and how that’s being handled even with states and areas. And so it’s just going to be an interesting time and I think that’s another big story that’s going to kind of affect markets and economy going forward.
Matt Theal: Yeah. The UK interesting, point in the COVID they recently just they’re done with COVID.
Joshua Winterswyk: Yeah. They’re going to handle it like the flu no more mask mandates.
Matt Theal: Yeah. No more restrictions, everyone’s back to work. It’s over in the… I mean, it’s not over, but in the UK, they’re going back to normal.
Brent Pasqua: Yeah. I think the data is pretty clear, right? If you’re vaccinated, your symptoms are mild at risk of hospitalization goes completely down. There’s no need for lockdowns. It’s time to move on. We have thing is to combat it now and it’s happening quickly.
Joshua Winterswyk: And we know enough about the new variant.
Brent Pasqua: I think one last thing that’s interesting on that though, is you look back now and say the two years that we’re in the middle of a pandemic, the market pulled out double digit returns year-over-year, and now we’re coming out of the pandemic and the market’s getting hit really hard. I mean, it’s pretty interesting the way that that happened. You think it would be the other way around, but.
Joshua Winterswyk: Yeah. Yeah.
Brent Pasqua: How can these stories though impact the stock market over the next six months?
Matt Theal: I think we’ve been hitting it, throughout the course of the show, but I just think this is going to be those kind of years where it’s really volatile, it’s going to be a fun market to trade in. There’s going to be a lot of fun kind of stories happening beneath the market, probably decent for some individual stocks that have been beaten up a lot, but we’re just seeing increased volatility. And your guess is as good of mine is if we have an up or down year, most likely I’d say there’s a decent chance we’re down 5% or a decent chance we finish up 5%.
Joshua Winterswyk: And just like with the volatility, even over the last year, stick to that plan, right? It worked last year.
Brent Pasqua: That’s what I want to know. I mean, as listeners hear what’s going on and maybe it raises a little bit of concern or maybe it’s opportunity, what are some financial actions that people can actually take to take advantage of the environment? Because everybody’s waiting for an opportunity. And if it feels like the sky’s falling, you don’t really feel like there’s an opportunity, but is there an opportunity here and what should they be trying to take advantage of?
Matt Theal: Yeah. I mean, I would be buying stocks as they come in, right? The indices haven’t come in that much yet. I mean, 5%, there’s probably better stocks to buy for kind of looking at individual names, especially in some small caps or some recent companies that came public last year. But for the most part, whenever the market comes in, you want to buy it. And it’s about finding a dollar cost average strategy that fits the amount of money you want to put in. So if you want to put in $100,000 maybe you do, you do it in $10,000 chunks or something like that.
Joshua Winterswyk: And I think it’s a good time to just for my and people. I mean, the beginning of the year, a lot of people had conversations if they got a raise because it’s a new year, a cost of living increase. Increase those 401(k) contributions. You’re buying more stocks if you’re doing that, just naturally, and that’s on a dollar cost averaging strategy where you don’t even have to think about it very much. And remember when those contributions are going in and the markets down, you’re getting a discount on those purchases. So increasing that is just another way to kind of take advantage of buying the dip or buying low. And that’s just another good strategy.
Joshua Winterswyk: But other things that financial actions that listeners can take to is, tax seasons coming up, it’s not just about the stock market or purchasing stocks. So there’s other aspects to that financial plan that you can promote value within and hiring a good tax professional enrolled agent, CPA to do your taxes is going to be very important. You want to make sure you’re very efficient with that tax return. And that’s another way that you can uncover some value and especially in a time where markets can be volatile or balance sheets and net worth can be a little variable to begin of the year.
Matt Theal: Yeah. I so much agree with that on that tax point. Don’t use what’s that tax software TurboTax or whatever that’s proven, that’s such a scam that just doesn’t save you money and just ends up costing you more and more money as you tack on the various services they upsell you.
Brent Pasqua: The rate of incorrect returns filed on that service is astronomical.
Matt Theal: Yeah. I don’t know why people use it. Don’t use it. Don’t try and self prepare your taxes. Do you try and take your own blood when you need to get blood work done? No, hire a professional, get it done right. Then if there’s ever an issue, they solve the issue for you, make your life easier or don’t make it harder.
Joshua Winterswyk: I like that joke. Hey, you ever perform your own root canal?
Brent Pasqua: Yeah.
Matt Theal: No you don’t.
Brent Pasqua: So, I mean, these are some items that listeners can take advantage of, but as you as an advisor, what are you doing also this year, as you see what’s going on?
Matt Theal: I booked a vacation.
Brent Pasqua: That’s great.
Joshua Winterswyk: Yeah. Doom and gloom to booking a vacation.
Matt Theal: Yeah, no, I so-
Brent Pasqua: Hire a tax person now, but I’m looking to vacation.
Matt Theal: Yeah. I’m-
Joshua Winterswyk: I love it.
Matt Theal: I’m just going to let the year, the market opportunities they’ll come, but I’ll be on vacation for most of it. No, I haven’t been on a vacation for a while. So like I said, we wanted to start living our life kind of how we were pre-pandemic as much as we can. We booked that big vacation. Financial planner in me, we used all credit card points and miles.
Brent Pasqua: Nice.
Matt Theal: So that’s always nice to get it mostly paid for free. So we’ll just be paying for food and whatever activities we do.
Joshua Winterswyk: We love that.
Matt Theal: So, yeah. That’s my big thing is over the first six months.
Brent Pasqua: What are you doing differently this year?
Joshua Winterswyk: Well, like I had mentioned the beginning of the show, me and my wife had our first child. So I’ll be doing a lot of family planning this year. So just reassessing, making sure life insurance coverage just estate planning documents are all up to date, stuff like that. But that’s my goal is to get all that start and making sure everything’s updated now that we have a new human in our house.
Brent Pasqua: You’re going to start a 529 minors account for your child?
Joshua Winterswyk: Yeah. Yeah, definitely. So all of those aspects that we like to hit for a new child, like you had mentioned the child’s accounts and then just all of the protections we need now that our family has grown. So looking forward to doing that kind of stuff as a planner, it’s not a daunting task for me. I’m kind of excited to finally do that. I mean, I’ve been establishing them for clients and family and friends for so long. I get to open up my first 529 for my own child. So very excited for that.
Brent Pasqua: Yeah. That’s very fulfilling and get your son off on the right step and that’s so good for him.
Joshua Winterswyk: Yeah. I’m still debating. What’s going to be his first stock, but maybe we can update that on the later show.
Matt Theal: It has to be Manchester United.
Joshua Winterswyk: Oh yeah. That’s a good one. Highlight, see, this is why I brought it up. You guys already helping me out with the first stock.
Brent Pasqua: What I’m going to do this year is I’ll probably continue to dollar cost average in the market as the market continues to fall, I believe there’s opportunity. And buying stocks at lower prices always make me happier than buy them at high prices. So the more they fall, the more I’d like to continue to add more money into individual stocks or ETFs and funds that are going to hold the whole market. So I’ll continue to try to take advantage of the opportunities that are presented this year. One tip that I think that a lot of people can do is, number one, do the same thing, take advantage of it. When the sky’s falling, you want to be taking advantage of the sky falling.
Brent Pasqua: Number two, if the market is continuing to fall and you already know that you’re going to be contributing a max amount to your 401(k) plan. You can put more in, in the first half of the year, or if you can afford a little bit more, maybe increase your 401(k) plan contributions or your retirement contributions in this first part of the year as the market is down. So you get more money in the first part as the market is continuing to fall. Instead of we could be past this by the fourth quarter, possibly, and then your contributions aren’t getting spread out. So-
Matt Theal: Good tip.
Brent Pasqua: Maybe consider putting a little bit more in at this first part of the year.
Joshua Winterswyk: Great tip.
Brent Pasqua: All right. So as we round out the end of the show, as we had finished out the holidays and into the new year, any RPA recommends, Matt?
Matt Theal: Yeah. So at Christmas, Hailey ended up getting me a bike. If she would’ve told me she was getting me a bike for Christmas, I’d be like, “No, don’t give me a bike. Like don’t do that.”
Joshua Winterswyk: But like a bicycle.
Matt Theal: Yeah. A bicycle. And actually, I really like it, it’s really fun to ride, get that fresh air. I put my daughter on the back of it. We have a child seat on it and we ride around the neighborhood. It’s really fun. So I guess my recommend is either do something you think you wouldn’t like unexpected or get a bike it’s actually kind of fun to tool around your neighborhood.
Joshua Winterswyk: Nice. My recommends, got a lot of cool gadgets for the new baby. One of my favorites though, is a Hatch. It’s basically like a baby nightlight, but it actually has some audio sounds to help soothe the baby that you can play through it. It has an app to your phone, you can control it and set timers for it. And then the light changes and they have different lights for ages. And if they’re sleeping or napping during the day and they have recommended settings and stuff like that. But you can even listen to it, talk through it really, really cool device. We love it. We have it going all the time for him, our little baby boy. So the Hatch looked up really cool for new parents.
Brent Pasqua: It’s amazing. Every couple of years, it’s just amazing the technology advancements they have for babies nowadays.
Joshua Winterswyk: Yeah. It, I mean, there’s so many cool tech stuff. I didn’t even know, I was clueless and a lot of stuff, we got us gifts and stuff we looked up that we wanted and just so much cool tech devices for these babies and that I’m enjoying. I think it’s awesome that they have these new innovative tools and services to help parents.
Brent Pasqua: Yeah, absolutely. It’s so neat makes parenting even better because it takes a little bit of the stress off too. Because you could control things like that and watch.
Joshua Winterswyk: Yep. Absolutely.
Brent Pasqua: One of the things that I recommend and I’m doing this year is I joined the board at the local little league. Not only just because I think it’s so great to help out in your community, but also it’s something that I really enjoy doing just with my son and my wife and my daughter, to be able to be at the fields and helping out and making sure that just things not only just go smoothly, but that you’re in your community and you’re involved and doing something in your community that you enjoy. And so my recommend is obviously if you have the time to volunteer and get involved in areas that you truly enjoy in your community, do that because they’re just very enjoyable times and you meet so many more people in your community. And I think that’s so important to just, not only with kids, but it’s good for our kids as exposure to the community, but to be involved in your community.
Matt Theal: Well said, I feel like you doing little league has been positive for you, so I’m happy you’re doing.
Joshua Winterswyk: Yeah, that’s awesome.
Brent Pasqua: I truly enjoy it. So, all right. So as advisors, we love helping people. That’s why we do it. If you’d like to schedule an appointment with any of us, please go to rpawealth.com and schedule complimentary consultation. If you can also download our ebook on our website and if you’d like the show notes, please go to retirementplanplaybook.com. But as always, thanks for listen. Sorry. It was a little bit of a break between shows, but we’ll be back on track very soon.
Joshua Winterswyk: Thank you guys.
Matt Theal: Thank you.
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